The Dangers of Do-It-Yourself Franchising
About 15 years ago, an entrepreneur came to me proudly displaying the franchise legal documents that he had prepared, and asked me to critique them. While I’m not an attorney, I said I would be happy to weigh in on the business issues that these documents contained. Half an hour later, I told him that the documents had a number of major flaws, and that they would need a complete overhaul if his franchise program was to succeed.
“That shows how much you know,” was his indignant reply. “We copied these documents almost word for word from the legal documents of the industry leader–and they are doing just fine without your advice. I guess we didn’t need a consultant after all.” I didn’t end up working with that company. Almost three years later, the industry leader he had copied from declared bankruptcy, and in another 18 months, my one-time prospect followed suit.
For all the change that has occurred in the world in the last 15 years, when it comes to human nature, things are very much the same. Not a month goes by that I don’t meet a prospective franchisor who believes that using outside help is a waste of money. Read more
This article was originally published on entrepreneur.com
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