Franchising Profits & Expectations

Added: (Thu Sep 08 2005)

Pressbox (Press Release) - In an informal study conducted by PurchaseFranchise.com, our readers have informed us that about 60% were satisfied with the profits from their franchise. The poll had 1,690 responses. Over 50% of those polled owned more than one franchise. Many franchisors require their business owners to own more than one location in the franchise contract. This increased their profits and helped the franchise to expand into more marketplaces.

When asked if their profits meet their expectations, only 35% of respondents agreed. Many franchisees expected to earn much more. We aren’t sure if their expectations were based on information given to them from the franchisor, or just their own independent expectations. A fast food franchisee said, “I expected to earn over $150,000 a year in profits. I am no where near that currently, though I have a decent income to support my family. My business is new and I expect it to continue to grow. At first I was disappointed with the earnings, but now I know that my expectations were too high, and the franchisor never said I would earn that much. I just thought I could do it better.” This seems to be the general opinion of many of the respondents. Many new franchisees expected to earn much more, but later realizing that they would need multiple units in order to reach their own expectations.

About 38% of respondents rated their profits as unsatisfactory. Many were only breaking even each month, and some were not even doing that. They blame lack of training, location, and the franchisor for a poor business strategy. Many were looking into selling their businesses to recoup the lost income. These respondents came from various types of businesses, such as food, auto repair, B2B, shipping, printing, and cleaning services. They cited that the hours were very long, and margins very thin.

From out poll, the majority of franchises are profitable, and many franchises are glad that they made the decision to join a franchise. Many tell us that hard work and persistence always pays off in the end.

Read more at Purchase Franchise

http://www.purchasefranchise.com