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My Franchise Experience
By Arnold Nadler
Maybe I was not lucky or associated myself with the wrong franchise. I had been self employed writing my own paychecks for a very long time. Some years I did better than others, but for the most part life evened out. I had a nice home, two paid cars, vacations, money in the bank, and the freedom to do what I wanted when I wanted.
When my Son was born in 1997 I thought maybe it was time to invest in a more consistent living. So what I did was examine different opportunities, and decided on a franchise that was well known, and people really liked their products. I was under the misconception that getting involved with a franchise was like a safety net. If you had a problem they would help you succeed.
Boy was I wrong!!!!
After filling out all their paperwork with my financials ECT... They invited me to come for an interview at their head office that was 6 hours from where I lived. They put me in a room and interrogated me for two hours. Three different people came in and asked the exact same questions. They told me they would let me know if I was accepted.
A week later they called with good news, I was accepted. Yeah!!! Then I needed to find a location. I thought buying a resale might work better because it was established, and I could see accurate figures. I found one in a good location, did my due diligence, had my accountant, and lawyer look things over, and everything seemed to be fine. The person was selling because they couldn’t manage two, not living in the same province as both of them.
The cost of this franchise was almost $250,000, and you had to have a certain amount in the bank for cash flow. I put down
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a portion and got a business loan for the rest. I was required to put down a $20,000 deposit and attend their school for three weeks at their head office. My personal expenses for this three week period exceeded $10,000. We were told as soon as we got there, if we did not get 85% or above in everything, no franchise, and we loose are deposit. No pressure at all, eh!! They condensed the equivalent of a university semester into three weeks. A few people in the class literally had breakdowns, no joke.
I did get through the school and passed. When I started working my franchise I found out that the people working there were selling drugs out of it, and that is why it was so busy. I had the task of cleaning everything up with no help from the franchisor at all. The morning crowd was a government office building around the corner, which moved a month after I took it over. I worked 18 hours a day, 7 days a week, for over 12 months. The business lost $20,000/month on average which I covered, and franchisor would not offer any relief as far as their royalties or a rent reduction. I had ideas how to recover the business, but they shot down every idea, and hide behind their franchise agreement. They let me sink and drown, and laughed at me all the way.
Here’s why
The franchisor bought the store back for $10,000 from the liquidators. What ended up happening was I had to declare bankruptcy, and suffered from mental and physical exhaustion for over a year.
What could I do?
When I signed the franchise agreement my lawyer told me it was a standard agreement. It happened to be about a hundred pages long, and they covered themselves a-z. I did not have a legal leg to stand on, and believe me I tried.
Advice
If you are going to hook up with a big franchisor “Buyer beware”
What have I done?
I started a venture to help and assist people in almost all aspects of business life. I have put together my own franchise business the way I think people should really be treated. Some good has come out of this experience because I am very passionate about helping other business people avoid disasters.
Article Source: http://www.articles-galore.com
Arnold Nadler is a long-time entrepreneur and founder of The Startup Business Doctor, a private company specializing in helping new and small businesses get their company off the ground. Programs include professional coaching, franchise opportunities and inexpensive advertising packages. You can get more information at StartUpBusinessDoctor.com
Products and Services mentioned in this article are available Here
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