Everything is determined by the contents of the UFA (Uniformed Franchise Agreement).
It 100% depends on how the franchisor builds their UFA. Mcdonlds for example is one end of the extreme where they very TIGHTLY control franchiees. So much, that they own the property, building and equipment that is used in the business. I have also seen where it is a situation of “do whatever you want” just send us “$X” amount each month for using our name.
Again, the devil is in the details of the UFA. Until those questions are answered and details presented, it is probably prudent to not make any determination of the value of a franchise or not.
Is he guaranteeing work? Why not just be a subcontractor for him?
Might be trying to lock you into a franchise agreement to lock you out as competition and starve you of work.
99 times out of 100, the first person to offer the deal is the only winner. There’s no such thing as a win-win deal. Ever. Buy a copy of Never Split The Difference by Chris Voss and tell him you want 2 weeks to think about.
After you study that book, if you’re still considering a deal with him you’ll at least know how to make things lean less in his favor and enough in your favor it might be worth a shot.
I didn’t determine the value of the franchise. I merely gave my own subjective opinion on franchising in general, and then followed it up with the recommendation that he have the franchisor draw up a Franchise Agreement to review.
My statement that “a franchisee and a business owner are mutually exclusive” and " if you have a real passion to own and operate your own business, you wont be happy as a franchisee" is, as i said, my own subjective opinion, but is rooted in the fact that no matter which way you cut it there will be limitations - whether it’s fiscally i.e. by the franchisor taking a certain financial %, or through the inability a franchisee has to make certain business decisions.
As I said in my original reply, and in this one, there’s no harm in having the franchisor draw up a Franchise Agreement and reviewing it with your attorney.
As someone who would like to have a role in the success of those in my circle of influence, I think the value of a business relationship often boils down to contribution. That comment about a $20,000 franchise fee waived because you’re such a swell guy doesn’t pass the smell test especially if no one else has paid that.
HOWEVER, if this guy’s intent is to mentor and guide you in business for a fee or percentage, that might be the best money you never got to spend.
On this point, we must disagree, my friend. I firmly believe that the only good deals ARE win/win. Relationships in business work best when each member of the relationship can embellish their own strengths, and in doing so strengthen the group. Some are good at figures and paperwork, some are good at the physical work, some are good marketers and salesman. Few are good at each.
When I was younger I would have given my left nut for someone who was good at what I refused to take seriously. Today I take advantage of as much automation as I can employ, and farm out a great deal of what I don’t know so I can focus on my strenghts.
If I had a couple of young guys who can do the jobs efficiently and courteously, making our customers happy while I focus on keeping everyone busy, what would that be worth? AND, if I’m paying for the marketing and have a good established brand, I would want to earn enough to make a profit. Rowdy, when everyone in a group makes more money and is happier because of the combined efforts of each member, I’d call that a win/win.
it is good and bad, you will be depending on him for business and you will never have your own reputation, reviews or customers, beside the agreement could be trap, they been in business long enough to know the legal tricks, I can see you have to use his company name and logo right there.
Hi everyone sorry for the late response been running around all week, I formed my company today. Waiting on my leg tank to arrive from northern tool and then the trailer build commences. Looking forward to the future and hope to grow alongside you guys
