The word franchise has interesting origins. It comes from Anglo-French, when it meant, freedom, liberty, and from Middle French, franchir, to free, and earlier from Old French franc, free.
Free? I'm sure there are plenty of franchisees who feel 'free' in the sense that they run their own business and don't have a middle manager further up the line telling them what to do. But owning a franchise isn't a free process. I remember being told by a colleague who had a cafe under the Robert Harris franchise system that the amount of money he had to fork out to the company each month was excessive, and, in the end he decided it was more economical to let the franchise go and simply run his own business unrestricted by commission charges.
I've had a similar report from a Mr Green franchisee. And indeed, back in the distant past I was a Bon Brush saleman. We were effectively franchisees to the company, and supposedly ran our own business. But the costs of paying the Bon Brush company cut the profits considerably, and I suspect a lot of franchisees find this to be the case with their own franchises.
It's something of a two-edged sword: on one hand you have all the advantages of a brand name behind you; on the other you have to pay the company a considerable percentage for the privilege of having those advantages.
In the end it's the company at the top that still makes the big money. Not that that's likely to stop people taking up franchises. According to one website, in the US franchising accounted for more than half of all retail sales. As far back as 2001 franchising employed nearly 10 million people; no doubt the number is well up on that now.
Some people do very well out of franchises, but I suspect that their profit margin is very high and that the commission they pay out is consequently a smaller proportion of that margin. If it's not, kiss the franchise goodbye; it's only eating up your money.
Showing posts with label franchise. Show all posts
Showing posts with label franchise. Show all posts
Monday, May 02, 2011
Sunday, December 28, 2008
franchises
Ever been tempted to go for one of those retail franchises, where you buy into a company and set up your own version of it locally? KFC and McDonald's are of course, prime examples, but I was interested to see what else I could take up a franchise on if I were of a mind.
The Physicians' Weight Loss program, for starters, or Return a Pet. I could become a Cartridge Depot, or offer a Space Walk to kids on their birthdays and other fun times. How about setting up a Flip Flop Shop? Good grief. How many customers would I need to make money out of selling nothing but flip flops?
Sports Clips is a men's and boys' haircutting franchise, where the them is sports. Embroidme speaks for itself. Interestingly enough, that's the name of a shop here in town, which, as far as I'm aware, isn't a franchise.
What about Speaking Roses, where you print a message on the flower? Doesn't that rather defeat the purpose?
The list goes on and on (and probably on, if the truth be told). My suspicion is that the only person making real money out of all this is the one who came up with the idea in the first place. Having at least ten percent of your income going straight out the door to the franchise owner always seemed to me to be a bit of a non-starter. Okay, you get the 'name' and backing, and the 'look' of the franchise. But regrettably, you still have to do all the hard work.
The Physicians' Weight Loss program, for starters, or Return a Pet. I could become a Cartridge Depot, or offer a Space Walk to kids on their birthdays and other fun times. How about setting up a Flip Flop Shop? Good grief. How many customers would I need to make money out of selling nothing but flip flops?
Sports Clips is a men's and boys' haircutting franchise, where the them is sports. Embroidme speaks for itself. Interestingly enough, that's the name of a shop here in town, which, as far as I'm aware, isn't a franchise.
What about Speaking Roses, where you print a message on the flower? Doesn't that rather defeat the purpose?
The list goes on and on (and probably on, if the truth be told). My suspicion is that the only person making real money out of all this is the one who came up with the idea in the first place. Having at least ten percent of your income going straight out the door to the franchise owner always seemed to me to be a bit of a non-starter. Okay, you get the 'name' and backing, and the 'look' of the franchise. But regrettably, you still have to do all the hard work.
Wednesday, July 25, 2007
Vending Machines Again
I like what one site says about the value of vending machines: they do all the selling for you, are always on the job, never call in sick, never insult customers, never give away free samples or steal your profits. And they collect the cash in advance…
You may think I’m just about to take up a vending machine franchise. Well, the more I look at the info on the idea, the more I wonder if there isn’t something in it. Of course, it would have to be a vending machine that sold something of reasonable value – I believe there are machines that sell pornography. Can’t see me getting into that!
Nevertheless, when I return home after my sabbatical in
Might have to go back and check out more about what Multivend has to say on the subject. It may be just what I’m looking for.
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