And, these expectations are the root of the problem that breeds bad feelings between a few franchisors and franchisees. The franchisee's distorted allegations that evolve from this dilemma are fueled by ambitious reporters and attorneys who are unfamiliar with the franchise selling process. Investors, who desire to be in business for themselves, usually perceive themselves as entrepreneurs. No franchisee is an entrepreneur, but most fancy themselves as such. Entrepreneur is another word that needs further illustration, particularly in the world of franchise investments.
Entrepreneurs engage in high-risk ventures.
Franchisors have no such business failure cushion. In fact, franchisor failure is equal if not higher than the failure rate of traditional business start-ups. There are hundreds of companies, each year, that enter the franchise format to form a franchise system and fail. But once a company has properly formed a franchise system, then all the benefits of franchising fall into place for the company and the franchisees of the system. All Franchise Profiles materials are copyrighted and protected by law.