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What are the disadvantages of buying a franchise?

Monday, 30 August 2010 | By Oliver Milman

The reasons that make a franchise so attractive to some can prove to be a turn-off to others. Being a franchisee requires a certain type of mindset and personality. Certain processes need to be followed closely.



“Free-wheeling, maverick personalities aren’t compatible with the systems of being a franchisee,” says Steve Wright, executive director of the Franchise Council of Australia. “A franchise needs consistency to have brand consistency and some franchisees run into trouble when it comes to this.”

You may be living your dream of running a business but, ultimately, it isn’t your dream. It’s someone else’s idea that you’re replicating.


This isn’t a problem for many people but be aware of how you’ll feel about this situation before you commit to it. While most franchisors are hands off, you won’t be able to make radical changes to your business without their input.


The relationship with your franchisor is also critical. The competence and personality of your franchisor may only reveal itself over time, so you may feel stuck with someone incompatible once you’ve started up.


Conversely, some franchisees become too dependent upon their franchisors. This is never a healthy situation, especially if the franchisor makes mistakes or feels that he or she can’t cope with the burden of having an overly-needy franchisee.