Many people sway one way or another when it comes to Franchising.  They either really want to do it or not at all.  In this guide, we are going to lay out the advantages and disadvantages of franchising.

Since Franchisors offer franchisees a trademark and a brand name, it is easy for franchisee companies to open up shop quickly.  Business plans are also offered to the franchisee allowing him the freedom to start his business without the hassle of creating a brand new plan and product line because the franchisor has already established that.  

Along with this relatively easy opening and fast start, these companies are also ready to start expanding fairly quickly and all over the world.  These companies will open up their market across the nation and over seas to other foreign countries which will ultimately increase the profits of the business.  Normally, without the help of a franchisor most franchisee businesses do not spread across its own nation and less around the world.  There fore with franchising, one is able to open up its business to the global market easier than without franchising  

If a franchisee contracts a franchisor, training is automatically included with the franchisors services.  Therefore, franchisee employees are receiving a relatively free training whereas a person who does not consider franchising would not receive this experience at all.

However, every good thing in life normally has a hitch.  There are disadvantages to franchising.  Some of these disadvantages include control of the company.  Franchisees have access to the business system, trademarks, assistance and marketing but anything he or she wants to change, add or delete ultimately falls under the decision of the franchisor.  Once, independent companies are now under the new control of these franchisors.

Since the franchisee is under the will of the franchisor he or she may have to spend more than what may be necessary.  For uniformity, a franchisor will want all trademarks to be the same.  The Franchisee may be able to get products for less but they may not be of the same quality as the franchiser wants and this results in the franchisor having to pay more only to be in sync with other franchises.  Also, franchisees must pay the franchisor’s fees and pay them royalties.

Often these disadvantages lead to conflicts, yet another disadvantage of franchising.  If one party does not fulfill his or her obligations in the franchise agreement, the partnership could quickly turn sour.  If the franchisee neglects his part, this could have sever consequences for the franchisor because it is his brand name and trademark that the franchisee is ruining.  Also the franchisor can neglect to promote the product properly. Frustrating the franchisee.  Even worse, is that the franchise contract mainly supports the franchisor and the franchisee endures all of the risks.