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23rd Feb 2010
When you become a franchisee you become an owner of a business, however you don’t receive the same freedom as you would if you started your own independent business.
One of the reasons you may have been attracted to franchising is the established procedures, policies and brand.
However, along with these also comes the need to operate within the franchise network policies, procedures and brand guidelines.
It’s through these elements the franchise establishes and maintains a strong brand which adds value to your investment.
Again, as discussed in my Franchise Myth #1 blog our research into conflict in franchise networks show franchisees that enter franchising with the belief they are their own boss often experience higher levels of franchise conflict.
These franchisees believe they should have greater control over operations and tend to have lower levels of compliance, which inevitably leads to conflict.
Examples of non-compliance include different prices, special promotions, lack of uniform, not paying correct royalties and more.
Our research suggests this type of behaviour also contributes to a lack of franchisee success.
Although this connection is rarely made by the poorly performing franchisee it is supported by the data.
Similarly, franchisees who enter franchising to be their own boss often become frustrated with the franchise limitations and become disengaged.
Franchising often involves a significant financial investment so you need to be aware of the policies, procedures and limitations for franchisees in your chosen franchise business before you sign the franchise agreement.
You need to make a self assessment as to whether franchising is the right business choice for you and whether the franchise business you’re considering is also the correct choice.
Conducting thorough due diligence will help inform you that you are selecting a franchise business network which is compatible with your business goals and desires.
Talk to existing and past franchisees and find out what their experiences have been like.
If you’re unsure what questions to ask check out the franchisee due diligence section of our website which provides some suggestions to get you started.
It’s also wise to get a range of professional advice (more guidelines on this in the franchisee section as well). A lot of the franchisees I’ve spoken to suggest investing in getting the right advice from the beginning because it will save you money in the end.
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