Franchisees and Franchisors beware

beanflying

Makes for some interesting reading even for those outside the industry. Check read and make sure you understand your responsibilities and or liabilities before you sign ANYTHING.  :o

http://www.smartcompany.com.au/franchise-tips-and-trends/six-recruitment-lessons-from-the-1-2-million-billy-baxter-s-case.html

posted on Twitter by cafelawyer

UNM

And if you are extra cautious, or sceptical, make sure you have loopholes, while the other party has none.

Ol Grumpy

Two Words: "Due Diligence" This whole case is an excellent example of what can go wrong when parties fail to do it.

Koffee_Kosmo

I own a franchise and have had it in place for 12 years Been happy with my franchise company I do acknowledge that not every franchise or company is the same so due diligence is advised One thing that crops up over and ove again is Some people go into a franchise with the wrong mind set, In there mind, to many are buying a job KK

Ol Grumpy

I happen to be a Franchisor and I can tell you that many Franchisees expect "cooked fish on a plate" when really what you are offering is a 'closed pool' for them to fish in. Ideal franchisees should see themselves and be treated as 'business partners' and they need to be good business managers to be truly successful... Don't get me started... I'm going back to coffee related threads :stupid grin OG

UNM

kk - many franchises are about buying and selling a job.  Mine is pretty much like that, although at the time I bought I was led to believe the VIC master franchise would soon be available. Didn't happen and as it was not in writing, I can't complain. There is nothing wrong with 'buying a job' as such if that is what both parties expect. not sure many franchises offer a closed pool to fish in as there is often third party competition, but a good franchise must offer mutual benefit to both franchisor and franchisee.  I remain highly sceptical of those that offer 'non-exclusive' franchise territories with all plant, equipment, consumables and ongoing marketing sourced exclusively from franchisor and where they have the right to rebrand regularly  at franchisees expense . People still seem to buy them though. one thing that bugs me is the number of franchisees that want to 'sack the boss', buy into a service based business and take time off whenever it suits them then wonder why they have no regular clients after a couple years.

Ol Grumpy

My comment was a little obtuse and not meant the way you have taken it, although I can see why you've interpreted the way you have. Doesn't matter anyway. Most people don't realise that there is no such thing as a typical 'Franchise Model', as such. There is literally an infinite number of variables and possibilities, although it doesn't always appear this way from the Franchisees perspective. A Franchise is just a business model. Nothing more, nothing less. Just like any business it must be assessed on its own merits, simple as that. It is a gross generalization and arguably over simplified, but in my observation most Franchise models are very good at teaching you how to 'do the thing you do' like mow a lawn, or make a pizza... But are intrinsically weak at 'how to get a client' Business success has far more to do with the Marketing of the business than the service or product the business 'does'. We all know Macdonalds does not make the worlds best hamburger. Yet does anyone remember what a happy meal costs? No... It's not even about the meal... It's all about the *toy*.... Now that's world class cutting edge Marketing and look at the success of Macdonalds- a company who sells sh$t on a stick... And Hungry Jacks keep trying to say, "Our hamburgers are better"... Idiots!