What are the disadvantages of becoming the owner of a franchise?

1 Answer | Add Yours

pohnpei397's profile pic

pohnpei397 | College Teacher | (Level 3) Distinguished Educator

Posted on

The major disadvantages of becoming a franchise owner have to do with cost and with the control over your own business and its image. 

Part of owning a franchise is paying the franchisor for the privilege of using their trademarks and expertise.  This can be very expensive and is a cost that is not incurred by someone starting an independent business.

Another part of owning a franchise involves giving up some degree of control over your business choices.  Franchise agreements often require franchisees to allow the franchisor to have significant input into various aspects of the business.   

It is also possible that being associated with the franchisor will hurt you.  This might happen if the franchisor runs into some sort of negative publicity.  Your business will be hurt even though you had nothing to do with the negative condition.

We’ve answered 317,673 questions. We can answer yours, too.

Ask a question