Is Franchising Scary?

Guest post by: John Power
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Franchising as an Alternative to an IPO? - By John Power

Financial: If the cost of the franchise development program may put the business at risk without franchise sales, or if the reason to franchise is to “save” a struggling business, perhaps the decision to franchise should be postponed.

Otherwise, the cost of a franchise development program is not normally excessive for successful businesses. Starting a franchise program is much less costly than expanding to a new city or starting a new department. The start-up costs are manageable, and fixed overhead is minimal. Most franchisors will recover the initial franchise set-up costs when they sell just one or two franchises, and will then generate income, oftentimes substantial income.

Franchisees: One of the purposes of the Franchise Disclosure Document (FDD) is to provide the franchisee with enough information to be able to make an informed decision about buying the franchise. If the FDD is clearly and properly written and followed, misunderstandings by franchisees will be minimized, and thus potential franchisee problems can be reduced.

Summary: Operating any business has certain concerns, and franchising does not necessarily increase those concerns. Business owners take on some risk when they sign leases, hire employees, and operate a business. But business risks can usually be managed with good planning and decisions. Franchising can be a very desirable business decision because it provides a new profit area.

When developed in an orderly and proper manner, franchising offers an outstanding opportunity for growth and income. We do not believe that becoming a franchisor involves much more risk than any other business activity, and that it should not be considered as scary. The challenges can be considered to be small compared to the income potential.

More information can be found at: www.biltmorefranchise.com

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Franchising as an Alternative to an IPO? - By John Power

About the Author: John Power

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John Power, founder of AdvantaFran Franchise Consulting, has extensive experience in franchise development and sales. He has been in and around franchising for over twenty years.

In 2005 Mr. Power began working as a franchise development consultant, and developed his own botique franchise development firm. He has worked full-time in the franchise industry since that time.

He has developed a franchise consulting company with experience in all areas of franchising, from legal document preparation to marketing, sales and support, and has brought over 30 concepts to market in the past 7 years.

Mr. Power also offers "shared sales management" services, which allows new and emerging franchisors to benefit from his sales and marketing skills and experience, without having to pay for a full time sales manager. Also skilled in developing "Streams of Positive Content," he will help you increase your sales success by creating a large amount of positive information on the internet about your franchise offering.

Mr. Power is a successful instructor and teacher of the franchising industry and franchising principles, and presents training sessions for both new franchise brokers and employees of franchise companies.

You may contact Mr. Power at www.advantafran.com

Click here to visit John's website.

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