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Franchising disadvantages |
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- The nature of the U.F.O.C. Franchise Agreement requires the imposition of controls by the franchisor and your conformity to accepted business practices.
- You will have to pay the franchisor a fee or royalty for the use of the business system.
- The success of your business depends (to a certain extent) on the success of the franchisor. If the franchisor experiences financial difficulties, or fails, your business may also fail - through no fault of your own.
- Because of the structured nature of a franchise, it is often impossible for you to select your preferred suppliers or even control the marketing of your own outlet.
- There may be territorial restrictions.
- There are restrictions on your ability to sell or re-assign your own outlet, and the franchisor must approve of the new owner.
- The U.F.O.C. /Franchise Agreement may be weighted in favor of the franchisor.
- Start-up costs may be higher than that of a similar non-franchise business.
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