For the benefit of the reader and Darryl’s business category, this article is designed for the individual looking at the option to invest in and operate a franchise frozen dessert business or rely on their own business acumen to proceed. Also, I suggest you read up on better understanding the differences in a license agreement and franchise and keep in mind, a license agreement can vary by state with specific limitations and terms.
The first indicator if a franchise is right for you, is how you view and opinion of a franchise agreement. If you believe it’s important to hire an attorney to review and comment on the document before signing, franchising is a good opportunity for you. If you’re the entrepreneurial stating “I’m smart and don’t need no stink-en attorney” well then, I suggest franchising is not a good choice for you. I have seen franchise agreements up to 160 pages long and believe me when I suggest, the contract is written on behalf and for the benefit and protection for the franchise, not the franchisee.
Franchise Pros & Cons Chart
I have put together a chart to show and address some basic points to consider if determining to franchise or go on your own. The chart does not suggest one direction is better than the other, but rather points you assume are offered and included when engaging in a franchise.
|
Factors & Capabilities |
Franchise Business | Your Business | |
| You decide on the best possible location | No | Yes | |
| Pay an initial fee | Yes | No | |
| Space & equipment requirements | Yes | No | |
| Pay a % from gross sales (not tax) | Yes | No | |
| Serve & charge what you desire | No | Yes | |
| Ongoing training support | Possibly | Hopefully | |
| Monthly sales reporting required | Yes | No | |
| Continued new menu concepts / trends | Yes | Hopefully | |
| Initial staff training and procedures | Yes | Hopefully | |
| Provide proven recipes & process | Yes | No | |
| Signage design & placement wherever you desire | No | Yes | |
| Negotiate lease points | No | Yes | |
| Flexible hours of operation | No | Yes | |
| Purchase some amount of used equipment | No | Yes | |
| Decorate and design as you wish | No | Yes | |
| Sanitation training | Yes | Hopefully | |
| Open multiple location as required | No | Yes | |
| Benefit from national advertising campaigns | Yes | No | |
| Mandatory advertising budget | Yes | No | |
| Make and sell your own specialty products | Maybe | Yes | |
| You are the overall boss | No | Yes | |
| Require a dress code or theme | Yes | Maybe | |
| Easiest to operate | No | No | |
| Guaranteed business success | No | No |
There is not reliable data on the success rate of a franchise vs sole proprietor, but still suggested to read up on options and factor if you are seriously considering to invest in a franchise concept. As with anything you are truly interested in investing in, I recommend visiting and talking with the owner of the franchise concept you like in order to receive first hand, unbiased information on the overall support and experience the owner receives.
Contact Darryl, he will help you determine if sole proprietor or franchising is best for you.
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