Is it Ethical for a Franchiser to Sell his Concept as a Franchise?
From a practical point of view, a franchiser who has found success selling the services and products of franchising outlets for public consumption, has a pretty rewarding business concept which is potentially profitable if sold. However, this is not applicable in all cases and it’s especially risky to assume so if you’re a franchise buyer. Many franchisers though would argue that if they have in fact meticulously crafted a successful business model over years of hard work, then they certainly have every right to sell it to others who would like a shot at this sort of success in the franchising business world.
However, selling is not a particularly good decision for someone who hasn’t been a franchiser for long. Many franchising consultants would cringe at the idea of a rookie franchiser adamant on the idea of selling their franchise, despite not even having sufficient time to perfect a business model. This is an especially unwise decision if not enough capital is on hand. This is because franchising a concept takes a few millions, at the very least. These millions don’t last very long, either if the franchiser isn’t careful and cautious with every penny coming out of his/her pockets.
Selling your business concept as a franchise should be preceded by enough years of very hard work, a successful tried and true business model and a solid capital in the bank. So before making that move, consult an expert and carefully assess your condition before making a huge mistake in more ways than one.
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