Too Many New Franchises Equal Too Many Problems

The number of new franchise offerings coming to market is speeding up yearly. In some ways this is a good thing because competition and multiple options are normally viewed as favorable. However, racing to franchise a business is usually a mistake for both the franchisor (that rushes into franchising) and prospective franchisees that are too inexperienced to evaluate the positive and negative aspects of a business opportunity.

I fully realize that among franchise consultants my opinions are usually minority opinions, but I am OK with that because I am reasonably confident that I can build a strong argument for my conclusions. .

Here's what I mean. While most 'fee for service' consultants (as opposed to franchise sales people that refuse to call them brokers and use the term consultant) will gladly tell a business owner that they stand a good chance of making it as a franchisor, I tell most people to simply forget the idea. After a short, but intense, discussion of franchise feasibility it becomes apparent that either the business owner or their system is simply not ready (and may never 'be' ready) for the rigors of franchising to others. I don't mind telling people that they shouldn't franchise their business because it helps me sleep at night. On the other hand, I almost 'never' advise someone 'to' franchise a business as that is the owner's decision not mine.