A permanent mark on ambulatory assets is an important initial goal
However, an unintended consequence over time is the accumulated effects of modern franchising on a society. The extended nuclear family is still the dominant source for advice, support and wisdom to individuals. This goes for small business investing, too.
I think franchising has worn out its welcome at many kitchen tables. Common industry practices have overgrazed the SME investment community.
Let’s take a look at some very conservative assumptions for Canada:
- 80,000 franchisees,
- 5% exit systems in one year, and
- 1/3 of exiting franchisees have what they perceive to be a “negative experience”.
Therefore, over 10 years 13,333 individual have had a sour taste that they attribute to an “unfair” situation ((80,000 x .05 x 10)/3). This doesn’t seem too much of a stray problem, especially when you assume they’re a docile and stupid quadruped (sheeple).
Information Sharing: But assuming franchisees are people, and people are social animals, they tend to communicate with others that they care about. And social media such as Facebook, blogs, YouTube, etc. seem to help enable anonymous warnings. Somewhere I read that every person knows 250 people.
So, maybe, there are +3.3 million that think franchising is dodgy. (13,333 x 250)
Or about 10% of all men, women and children who giving, for free, 24/7, an “anti-franchise” message to their family and friends. Battle stories along with life savings scars. Authentic, nitty-gritty, genuine, hyper-sincere detailed stories. Tangible life stories versus self-serving hyperbole.
No wonder there are so many immigrant family horror stories. In their innocence, they actually believe white crime is punished when it happens in Canada. Discovering a network of snakes in suits hiding in plain sight is the 2nd, much more profound existential trauma.
Teach you Children Well: Franchising is an exceptionally powerful teaching technology: the tuition to learn these lessons about modern commercial standards is not without cost. Dairy and beef producers have different management philosophies and practices.
From my experience, branded families are finding their digital voice and starting to be herd.