Franchising exchanges $ for passivity and distrust

As someone who has been a franchisee, worked with franchisees for 10 years and also worked in a provincial psychiatric hospital, the following Erving Goffman quote has always intrigued me:

  • Society is an insane asylum run by the inmates.

Goffman is arguably the most famous sociologist of the 20th century and his 1961 book Asylums: Essays on the Social Situation of Mental Patients and Other Inmates promises to be fascinating.

I am just starting into it but by scanning Wikipedia and the book itself, these are the themes I will be looking for as I read it:

  • a mental-hospital patient is formed more by the institution (not the illness),
  • patient’s reactions and adjustments are similar to those of inmates in other types of institutions,
  • two classes are created and maintained within every institution (guard and captor),
  • the features of the structure is primarily to create predictable of behavior of both classes, and
  • Goffman defines a new term “total institution”.

Total Institutions are closed worlds such as prisons, army training camps, naval vessels, boarding schools, monasteries, and nursing homes where:

  • the inmates are regimented,
  • surrounded by other inmates, and
  • unable to leave the premises.

I think franchise systems have many of these prison-like characteristics and that being a franchisee is a life altering event. One franchisee described it as undergoing 3 divorces at one time.

I have noted the similarity between a franchisee and being a member of a cloistered religious order or cult.

You enter into a totally new faith-based world, a re-birth actually (foreign language, working 60-70 hours per week, long-term relationships put on hold, charismatic leadership, etc.)

Franchising powerfully changes the investor’s personality and personal identity as does every closed world. (But, dangerously, without any emotional safeguards for the initiate nor any models/myths/maps to return from their adventure.)

For me, modern franchising primarily produces two “products”:

  1. an investor who is both cognitively and emotionally incapable of defending himself (so institutionalized, so passive as to be unable to help himself, even if they had the individual economic resources to do so) and
  2. an investor who is also impossibly distrustful of everyone else (many times the most suspicious of those most able to help them); although together as a group, they could solve their collective problem.

Franchising has the power to create and then imprint learned helplessness (a psychological condition in which a human being or an animal has learned to act or behave helpless in a particular situation, even when it has the power to change its unpleasant or even harmful circumstance.).

All authorities can “brand” this helplessness because humans tend to:

  1. underestimate the influence of the situation and
  2. overestimate our individual defenses.

I’ll report back.

Slaves lose everything in their chains, even the desire of escaping from them: they love their servitude. Jean-Jacques Rousseau

5 Responses to Franchising exchanges $ for passivity and distrust

  1. Carol Cross says:

    Wow! Les! You remain totally pissed off against franchising —-but I think you are right. I hope you are right that it will be increasingly difficult for franchisors to recruit Moms and Pops to donate cheap labor and cheap venture capital to the franchisor and the “system” —-You still haven’t told me who drives the getaway car.

    It is because the failed and the tired breakeven franchise investor feels so foolish and ashamed that he/she did invest in good faith and that they were “taken in” and “should have known better” that they turn their anger and shame inwardly and do become emotionally ill for a time until they get better or just sink into despair and disappear into obscurity.

    They are SURE that a fraud has been committed against them but they don’t know what to do about it and unless they join in some kind of collective action with others, they are dead in the water most of the time. They know all of the reasons the franchisor is WRONG but they don’t want to recognize that public policy has designated ZEES to be little fish upon which the big fish can feed (and go public in IPO’s or work out securitizations of royalties, etc..) They don’t and won’t realize that they are a PREMEDITATED victim of ineffective regulation that they were told was to protect them and inform them of the risk — and they won’t raise up their voices to the FTC and protest the LIE in the Halls of Congress.


  2. franchisefool says:


    I am decidedly NOT pissed off with franchising. I am only trying to understand it without glossing over some promising ways of looking at things.

    As a military person, you know how brainwashing and thought-control was used to break people down. This is a very sophisticated and subtle process that, literally, creates a new person.

    I saw on television tonight that they are starting to use service dogs to help PTSD veterans with their panic problems. A veteran of the 2 Gulf Wars and Somalia was highlighted: he still can’t talk about Somalia 15 years after the fact.

    Franchising veterans need to understand that they are FUNDAMENTALLY different than they were before signing up. People say that knowledge is power but they refuse to admit how much of a different person they are AFTER they have had a franchising PhD forced on themselves.

    Carol: A new identity has been coerced on people as much as a steer is branded. It is not the money but that how they relate (their place in society) to everyone else that has changed.

    The institutions such as politicians, congress, FTC, business leaders, etc. where thought as helpful or at least neutral. The betrayal goes very deep and leaves the unaware former franchisee adrift without many social supports.



  3. Carol Cross says:

    Yes! it does feel like betrayal to be eaten, used, or exploited by the system and to understand that as you say “politicians, Congress, the FTC, business leaders, etc. who we thought were at least neutral” are just supporting an ugly status quo that they perceive to be in their best interests. Within the system, they rationalize the status quo as serving the “greater good” and rationalize that there are “some” who will always be sacrificed to the “greater good” of those who get to decide what contributes to the “greater good.”

    Betrayal, of course, always hurts and does change us and we are never a complete work. Jobless and brokem franchisees who lose so much in terms of security and their lost life’s savings and their lost credit ratings do have a new identity because identity in modern culture depends upon the dollars one possesses, that in turn determines one’s place in society. In our Western culture, the poor are usually invisible and we like to think that the poor deserve their status —because they didn’t do their due diligence in life.

    Those who lose big in franchising are in a sense “adrift without many social supports” after their unemployment runs out and they have lost their hope in the American Dream. Everybody loves a winner! Laugh and the World laughs with you –Cry and you cry alone. Some survive and some don’t and all are changed from the hard lesson, but those who lose everything often give up all hope —–like Bob Baber of Quiznos who will be dead two years on November 27th. I disagree with you, it is only not about the money when we are dead. Money is like water, we need it at least to survive our time here on earth.

    Hard times ahead for the people. Our identities are established by the work that we do in life and the need for dollars to feed our senses and when there is great joblessness, there is great fear and political upheaval and pain for the people who always bear the consequences of the excesses of those who work for the “greater good” knowing that they will always survive in good and bad times and that “the poor are always with us” in good and bad times.



  4. franchisefool says:


    We agree on many things but there are two points that divide us.

    1. Money is the ultimate illusion (maya). Not one single franchisee I know of (+5 years on) mentions money as the principle problem. It’s always (and I mean always) the promises kept and promises broken by people they believed were on their side. It isn’t hatred for them: it’s self-loathing in being blinded by the franchisee’s own weaknesses that allowed them to self-deceive. Forgiveness is not forgetting.

    2. There is the ability to transcend this situation. Movies like The Shawshank Redemption and others point to a greater truth than the one we must obey on the material world. The key seems to be re-finding your worth by helping others.

    Carol: You should take pride in raising your voice and warning thousands of people. Whether they listen or not is not within our power. We own our efforts but must leave the outcomes to posterity or fate or whatever you choose.

    This weekend is Canada’s thanksgiving, Carol. My kids will be home from school and we’ll be among family that welcomes us because of our shortcomings (not in spite of them). This is where music comes in: it allows our bodies to absorb shared experiences.

    Some spiritual practices see the deceit of separateness (you:me. out:in, good:bad) to be the principle obstacle in this life.

    What more could a person want, now really? And how do you quantify that or health or loyalty or courage or…?



  5. Carol Cross says:

    Happy Thanksgiving, Les! Hope you and your wife and children will have a joyful weekend together. I know you are proud to have your children in college and that they are your great joy in life and your greatest creation and contribution to the better world that we aspire to create.

    Since we are from different generations and our experiences are different, our emotional and spiritual IQ’s are closely matched —-but, of course, I come from the edge of the great depression and “security” in terms of “money” has always been highly important to me. Some of my earliest memories are of the pain of joblessness in families and hunger in the form of “tramps” that my family fed on the back steps of our little bungalow on the very South side of Chicago, where, off of the incoming trains there would be hundreds of hungry men jumping off the trains early, before they reached the yards, to walk into Chicago to look for work.

    If one is born ugly, it is better to be born ugly and to have money. If one has ill health, it is better to have money than to have ill health and to be poor. To be truly poor and to have no money and to have to depend upon the charity of others is a truly humbling and humiliating experience. To lose a lot of money in a franchise, and to see the pain of your family, but to have a good government pension, as we do, does give one strength and a voice. I understand why those who lose everything are silenced and slip away into obscurity and, as you say, as different people entirely because of the transforming experience.

    I am proud that I am able to warn and to try to share my view of franchising and the lack of regulation that has permitted it to grow in our economy and in world economies. It was from you that I first learned and understood the exploitive nature of the business model and it was you who first comforted me when my research disclosed that “my” government was not on my side when they regulated franchising.

    You are on my list of people to be thankful for when our American Thanksgiving gets here. There are already speculating that there will be a Black Friday after Thanksgiving because Americans are scared and will cut back their buying. The day after Thanksgiving has always been the biggest shopping day of the year in the USA and the merchants count on it to stay in the black. But! maybe after the election and after the coverage of the bailout is out of the news, Americans will regain their optimism and shop for all of those “material” things that we humans seem to covet and to enjoy. We live in a World where the giving of those things material is representated as the greatest form of love by the Madison Avenue Commercials and we don’t like to come up short. Tongue in Cheek, my friend.


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