Should you even buy a franchise?

Hi folks,

One of the most common questions I get is the most basic one: Should I even buy a franchise?

You’re not crazy for being skeptical. 

In fact, you should be skeptical considering how many franchises have high fees, no support, and terrible ROI.

The harsh reality is 90%+ of franchises are hot garbage.

Want to know how to spot that 10%?

Read on.

Let’s revisit my hot take for a second: 

If 90% of franchises are hot garbage, why would anyone do it?

Consider this: it’s not just franchises. 90%+ of small businesses in general are hot garbage and not worth owning.

It’s odds like these that turn people away from business ownership and keep them in the cubicle forever.

But since you’re reading this newsletter, you probably don’t think like that.

As small business owners, we embrace the fact that the odds are against us. 

That 90% statistic doesn’t push us away from business ownership, it drives us to be smart about choosing the right one. 

I think about the franchise marketplace the exact same way.

So, how do we proceed when the odds are not in our favor?

Let’s look at how to spot that 10%.

Most franchises are built to sell, not to scale

A ton of franchise brands out there probably shouldn’t be franchises at all. 

Why? Because there’s an entire ecosystem of vendors whose only trade is turning small businesses into franchises (for a hefty fee, of course).

Here’s how it happens: 

Someone’s out there operating a successful independent business. 

Along comes a vendor who says, “Hey, pay us $100K and we’ll help you turn this thing into a franchise. Just sell a few territories and you’ll start raking in the royalties.”

What happens next is predictable:

• There’s no real ops infrastructure

• No marketing support

• No tech stack

• No vision beyond “sell more”

If you end up buying into a franchise like this, you’re somebody else’s side hustle, with none of the systems that make franchising valuable.

A franchisor (the brand) should be focused on the success of their franchisees (the operators).

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But when it works, it really works

Here’s what the good ones look like.

A great franchise system gives you:

• Proven and clearly documented SOPs (standard operating procedures)

• Centralized support (tech, ops, marketing)

• Group buying power and vendor relationships

• Real-world validation from current owners

• Strong confidence in an accelerated path to driving revenue

That last one is key. When you join a well-built franchise, you don’t spend your first year duct-taping together software and Googling “best CRM for cleaning business.”

You start executing on day one.

You skip the startup slog and go straight to scale.

You’re not paying for a logo. You’re paying for a head start.

→ Related read: Why some franchise fees are actually worth it

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Red flags

I wrote about this in more detail (link below), but here’s a hit list of franchises to avoid: 

❌ The Side Hustle
The franchise is built on one or two corporate locations and no ops team. You’re the guinea pig.

❌ The Free Rider
You’re paying a royalty, but there’s no real value. No logo is sexy enough to justify 8% of your revenue if you’re getting Fiverr-level support.

❌ The Money Pit
Huge upfront investment, but thin margins and slow ramp. It might be technically cash flow positive… but the business is worth less than you put into it.

❌ Indentured Servitude
If the franchise agreement locks you down, run. Maybe you aren’t allowed to hire a manager. Or expand to multiple units. Or run another business on the side. Congrats you just bought a job with a royalty.

❌ The Passion Project
The franchisor cares more about the mission or lifestyle than unit-level profitability. Great for nonprofits. Bad for investment.

If you see any of these, move on.

→ Related read: 5 franchises to avoid like the plague

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So… should you even buy a franchise?

It depends on what you want.

If you want full control, total autonomy, and the freedom to invent every process from scratch, don’t buy a franchise.

I’m the first one to tell you that there, is plenty of upside that comes from starting your own business, even if that’s not the path for me.

But if you’re looking for:

• Speed to revenue

• A proven playbook

• Systems that work

• Infrastructure you don’t have to build yourself

Then yes—buying the right franchise can be one of the best moves you ever make.

The trick is knowing how to spot it and how to navigate the process.

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That’s what I help people do.

If you want help finding a brand that actually deserves your time and money, let’s talk. I help people with exactly that question every day, at no cost to you.

Book a free call here.

Thanks for reading,

Connor

P.S. Got questions? Come and ask them on my free live webinar, next Thursday! RSVP here.

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