Franchise Companies Come and Go

Each day we hear of companies entering the franchising industry. This is good news for America, right? Well, yes and know. Yes, because franchising is the closest thing to the spirit of free enterprise as any other method of doing business and because franchising offers small business people advantages that they would not normally have in pursuing their American Dream. However it is unfortunate but true that the average Franchisor failure rate is 5:1 in five years. Meaning they are gone out of business in that short amount of time. This is horrific news really. Why is this? Well most often it is due to over regulation, junk lawsuits, under capitalization or greed. Having played in the franchising industry I have seen it all.

Recently I had, had enough of the crap of beating my head against the wall, sure the money is excellent if you have a good concept and we certainly do; www.CarWashGuys.com ; but we found it was easier to make more money and keep more by not growing thru franchising. In franchising you can grow faster, in a 4-year period we went from 4 states to operations and franchised outlets in over 23 states. My point is that there are just too many lawyers and regulations for one to actually believe that anyone in government actually believes in free enterprise, to think they do is a bogus notion indeed.

In our company we are not currently offering franchises to the public. Our focus is to set up company owned units across the US and eventually the world and since I have retired the team will have to do it on their own, sure a few phone calls here and there for moral support or advice, but it just is not worth dealing with that level of bureaucracy and over lititigiousness. We may franchise in other countries but the United States being regulated by the Federal Trade Commission has their heads up their asses and it makes no sense in America anymore. Generally this business decision was made due to many following factors, some of which are listed below:

Sarbaines Oxley Law and Accounting Reporting Cost Increases,

Over Regulation in Franchising and Litigation,

Multiple State Franchise Registration Laws Out of Sync,

Disclosure Laws Hurting Company Proprietary Information,

Required Disclosures which Might Help International Terrorists,

Disclosure Laws, which Require the Giving Out of Personal Information About Franchisees.

Litigiousness of Franchising and Absence of Tort Reforms in the US and Canada,

Higher Profit Margins for the Company Running Our Own Units,

More Efficiency to Corral Our Competition,

More Latitude to Take on New National Account Business,

Better Service Standards for Current and Future Car Wash Customers,

More Control of Business Model and Less Red Tape

We have chosen a new strategy along the lines of a Starbucks, Home Depot, Enterprise Rent-A-Car, Federal Express type scenario where we can exert more control and less red tape to insure higher standards and smoother business operations. Regretfully this does impact the small business community, franchise model and those who dream of owning their own franchise business. Over regulation usually does hurt the little guys and stifle competition and creates barriers to entry.

We are not the only franchisor who feels this way and if the failure rates for franchisors in our country are 5:1 it would behoove new entrants to the franchising industry to think long and hard before getting into the franchise game. If you do not have a million dollars going in, you should not go. If you have not proven your concept in many markets over various business cycles forget it. Additionally you may want to look at alternatives to franchising, because with all this over regulation you are not going to have any fun doing it. Think on this.

"Lance Winslow" - If you have innovative thoughts and unique perspectives, come think with Lance; www.WorldThinkTank.net/wttbbs

In The News:

Upwork Launches Project Catalog  Small Business Trends
Best small business ideas UK  Simply Business knowledge
A Way Forward for Small Businesses  Harvard Business Review

Lubbock TX Good Market for a Service Business

We very much like what we see in Lubbock, TX... Read More

How to Give Informative Talks

Why should you do informative talks to smaller groups?Informative talks... Read More

Do You Want Your Own Fully Programmable ERP? - Part 2

In the first article we mentioned the main characteristics that... Read More

Reduce Stress, Increase Profits By Incorporating Strategic Systems In Your Small Business Success

Whether you are an Entrepreneur or Business Professional there are... Read More

Truck Wash Business Case Study

Often smart entrepreneurs look for out of the way businesses,... Read More

How to Integrate Yourself in Someone Elses Business

When do you need to get more involved with the... Read More

So What? How to Elicit Benefits from Features

"So what?" is a lovely question.It can lead to a... Read More

Make Your Business More Profitable

More sales and more profit. Isn't that what you want... Read More

Mission Statements: More Important Than You Thought

If an organization lacks a mission statement, it is worthwhile... Read More

Pressure Washing at Golf Courses

There are many potential niches for pressure washing companies that... Read More

Virtual Assistant ? Questions Answered

What is a Virtual Assistant?A Virtual Assistant is a person... Read More

Breaking The Chains!

Everyday, customers and business owners are bombarded with billboards, logos,... Read More

Cost Effective Franchise Regulations, Come again

The Franchise Group at the Federal Trade Commission in all... Read More

Going Public: Now that You Have Successfully Made the Transition, What Do You Do?

Ok, you have successfully accomplished your dream of being the... Read More

Why Small and Medium-Sized Businesses Should

As the owner or an employee of a small-to medium-sized... Read More

Pressure Washing Business; Steam Cleaner Fuel Maintenance

It is essential that you fully understand how the fuel... Read More

How to Promote Your Business by Entering Contests

You are probably hard at work promoting your business (and... Read More

But Weve Always Done It This Way

Sacred cows take a long time to die. We get... Read More

Creative Marketing Tips: Simple Things You Can Use In Your Business To Attract More Clients

The single most important activity you can do in your... Read More

Cabinet Refacing Business Opportunities

With all the cabinet refacing business opportunities out there, you... Read More

Small Business CRM Is Here To Stay

If you ask most small business owners what priority CRM... Read More

Alliances: Drawing The Line

How far can you go based on your relationship with... Read More

Accepting Checks in Your Business Virtually Risk Free

Most businesses accept checks as form of payment for goods... Read More

Hiring A Virtual Assistant Can Help Your Business Grow

Are you a home or small business owner and you're... Read More

7 Tips to Improving Your Cash Flow

Cash is King... That is what everyone tells us and... Read More