Franchises: Don’t Go In Half-Baked

Herald Sun:

First, the bad news – there is no pot of gold at the end of the franchising rainbow. And if the 600 complaints received by the ACCC last year are any guide, there may be a lot worse.

The bulk of these complaints relate to unrealistic expectations held by prospective franchisees who have not done their homework, Griffith Business School research shows.

The stakes are high. Buying into a franchise begins at $5000 for start-ups and stretches beyond $1 million for established brands. New franchisees also have to pay brand royalty fees and a contribution to advertising and marketing – that can easily amount to 15 per cent or more of monthly takings.

University of Sydney Business School‘s Andrew Terry says those contemplating starting a business can be attracted by franchising. Read more.

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