The Daily Forex

…the nexus, but if what Guest is saying is that the status quo benefits everyone but the franchisee, then perhaps I have not been clear.

I think the status quo benefits the substandard franchisor, but may actually be detrimental to the quality franchisor: franchisors would benefit from a more discriminating view of the franchise industry. There are a lot of incompetent (and even disreputable) franchisors out there. The problem is that the negative stories about systems such as Quizno's and UPS Store turn off a lot of prospective franchisees.

Just because the Ford Pinto exploded on a whim doesn't mean that folks attributed that to all cars. Just because Enron stock was a poor investment doesn't mean that Microsoft stock is a poor investment. Crappy franchisors are disproportionately the ones that pitch the "95% success rate" "buy a proven system" "in business for yourself not by yourself" garbage. People do still tend to lump franchisors in one category.

Sites such as BlueMauMau have gone a long way to educating the public about evaluating each franchise as an independent investment, and I would suggest that the franchise industry should encourage prospects to discriminate.

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