Friday, November 7, 2014

Buying a Franchise. What was I Thinking?

As I related a short while ago, I'd been thinking about buying a franchise, but after reading the Franchise Agreement, as well as conducting additional research on the subject, I asked myself, "What am I thinking?"

I am not an attorney, but I am not a simpleton, either, and I really wonder what possesses people to sign what in most cases appear to be—as Robert Purvin, author of The Franchise Fraud, says—one-sided and unjust agreements.

After reading the whole franchise agreement, it was obvious to me that I was going to have to pay for the right to basically become an unpaid employee or agent of this particular franchisor. And while some will quickly claim that in order to "join forces" with a national brand you have to be willing to pay the price, part of the issue I had with this "brand," is that I had never heard about it before.

In other words, I would help them financially to build their so-called "brand."

Frankly, it is almost comical to think that I would consider paying someone for the right to use their name, do the marketing, handle all the social media requirements, hire personnel, etc., etc., and hope to eke a living while the receptionist who is employed by this franchisor makes a steady salary and, most likely, gets some benefits.

Am I the only one who thinks there's something wrong with that picture?

I am not saying that every franchisor out there makes outrageous demands, although it seems that most of them do. And why not? After all, if someone is willing to gamble their savings or future in such endeavors—and there are millions who obviously do—then obviously demand exceeds supply, so my guess it that the one-sided franchise agreements will continue.

What I am saying is that buying a franchise is not the thing for me!

But, since I am ready to join the entrepreneurial ranks again, what I've decided instead, is to consider buying an existing business versus starting one from scratch. The time seems right for such approach, so we'll see what happens.

Stay tuned!