Best and Worst Franchise Buys
Many potential franchisees just walk into a shop and catch the dream that this is where they want to be. They throw their luck to the wind to see what comes back.
Others are much more methodical in narrowing down a good investment opportunity. The lists below of the best and worst franchise brands are for them. Trade journals such as Entrepreneur, Franchise Times and others rank franchises and receive some nice money for doing so. The chief criticism of such rankings is that some lists seem more a function of how much a franchisor is willing to pay in advertisement to be ranked highly. Because not all lists are of the same usefulness, Blue MauMau not only lists these lists, but its editor and members also rate them.
REVIEWS OF BEST-FRANCHISE-TO-BUY LISTS. Blue MauMau ranks the lists from various media and trade journals of the fastest growing, the largest, or the overall best franchise investment.
LIST OF BEST FRANCHISE BRANDS BY OWNER SATISFACTION. Want to know the real scoop on whether a franchise chain is good or bad? Ask their franchisees. They'll know. However, if you want a frank revelation, franchisees must be certain that they will remain anonymous in order to feel safe enough to tell you like it really is. Otherwise, there's a good chance they'll use the opportunity to score points with the franchisor to help them win future favors. And enough franchisees must be asked (no, we're not talking 10, but rather over 70%) in order to know that the answers are representative of the system as a whole.
BANKER'S LIST OF SAFEST AND RISKIEST FRANCHISE BRANDS: Know what the banks know. The Small Business Administration gives this list of franchise brands to only a select group of preferred lenders so these bankers can know what brands to lend to and which ones are risky. In the past this highly sensitive list was unpublished. Few franchisee investors knew about it. Blue MauMau was the first journal to publish this list — for free.
CONSUMER'S LIST OF BEST BRANDS: Some argue that at the heart of a great brand is what consumers think of it. That is to say, why pay royalties to the franchisor if the consumer has no positive recollection of the brand at all? Might as well start your own company. Customer Research International's army of some 2500 mystery shoppers tell us the brands that are making an excellent impression on consumers.
WATCH LIST FOR FRANCHISOR INSOLVENCY: Here is our meager collection of franchisors who have at some time in the past filed for bankruptcy. And here is a watch list of distressed franchisors struggling for solvency that have announced either that they may soon undergo bankruptcy proceedings or that are currently under bankruptcy.
It's not that franchisors don't file bankruptcy just about every day. It's just that until Blue MauMau recently started gathering such data, no trade journal or blog bothered collecting such terrible news — to the detriment of franchise buyers. It's no fun being a franchisee and your franchisor disappears. The first problem is that your customers will think you have disappeared. The second is that you can't get supplies. Sam's Club anyone? (Editor's note: Readers, please help us keep these two lists updated by posting any new information you have on a bankruptcy and a link to the announcement.)