Disillusioned about Franchising?

Throughout my 20 plus years of experienced in franchising I have taken several sabbaticals. These times of rest away from franchising have been driven by different events in my life and have lasted from just a few weeks to several months. Underlying these times has been a sense of disappointment. Late last year this feeling of discontent was approaching again. I could sense it and see the signs, but this time it was different. For the first time I was more aware of its approach and thus could observe what has happening and why. One day I heard myself say to Bob, my husband and business partner: “I am just disillusioned about franchising, specifically about the franchise relationship.” All of the sudden after those words were expressed, a new understanding arouse.

I had used the perfect word to express my feelings, as well as its causes! That word ‘disillusioned’ was the key.

The dictionary defines ‘disillusion’ as ‘to free or deprive of illusion’. And, I definitely had been under a self-created illusion.  I believed that because the franchise relationship is based on the win-win principle, the parties involved must care ‘first’ about the other party; and, must always seek the win of the other party because it is in the other party’s win that they can find their own.

When the veil of illusion was lifted, I could see that I had created standards impossible to achieve. The problem was in the absolute nature of my belief. The use of the words “must,” “first” and “always” tainted an otherwise true statement.

People in most cases care more about themselves than they do about others. We even see it in the closest of families; so, why on earth would I think that a business relationship would be exempt of this human trait? The franchise relation is dictated by a legal and operational structure that invites more cooperation and more dependency than other business relationships. In more than one way the franchise relation resembles a family. Yet, although it invites cooperation, it cannot make an entrepreneur care more or less about others; nor can it make a franchisee be a better team player. People who are drawn to franchising their businesses, in most cases, feel the pull because of the economic and ego rewards it offers. Very rarely have I heard people express that their main reason for franchising was to help others. That has been my trip, my blind spot, and the cause of my disillusionment. I had created a belief to match my own preferences; and thus, when reality did not match my expectations I felt a sense of discontent and disappointment.

When illusions are lifted one can see, accept, and even appreciate, things as they are. There is nothing wrong with the franchise relationship. There is nothing wrong with franchisors seeking their own gain and franchisees doing the same. That’s just the way it is; these parties are human. The structure of the relationship makes franchisors aware that it’s to their best interest to support franchisees and likewise encourages franchisees to protect their brand and team.

Now that the illusion is gone, I can appreciate the franchise relationship even more for what it is and for what it’s not. In franchising we are dealing with people with their strengths and their weaknesses, and with their humanness. Yet, in franchising people are encouraged to bring their best qualities to the forefront; they have an economic incentive to do so; and when they don’t, they suffer the consequences. Franchisors who don’t support and/or abuse their franchisees experience a shrinking of their network of locations. Franchisees who decide not to follow the franchisor’s system or not to be part of the team have a harder time achieving the success they seek.

Last year’s debate triggered by the CNBC report “Behind the Counter: the Untold Story about Franchising,” in my opinion, resulted in the best of franchising coming forward as franchisees joined the franchisor of Cold Stone Creamery to defend their brand. This is what franchising is all about: the team, the single objective, the win-win. Franchisees and franchisors may have differences; but, like in many families, when an outsider attacks the system or the family, its members unite.

The recent economic downturn definitely has taken its toll and this time franchising was not able to escape it. As many franchisors were not able to respond quickly enough to the economic changes, their franchisees experienced drastic consequences and in many cases failure. Yet, overall, I bet that franchised businesses still have done better than most small independently owned ones.

So, yes, Franchising is not perfect. But, what is?


  1. Les Stewart says


    I too have taken time off from my unpaid 13 year project.

    I, however, have created and indexed collection of thousands of documents that speak for themselves.

    Franchising is indeed a greater teacher for the delusional and those the profit from that magical thinking.

    Les Stewart MBA
    Midhurst ON Canada
    WikidFranchise.org : lesstewart.wordpress.com : linkedin.com/in/lesstewart

  2. Hi Lizette,

    Thanks for this post. Franchising is far from perfect, but a few of us are trying to make it better.

    I totally disagree with your view of how the “CNBC Special resulted in the best of franchising coming forward as franchisees joined the franchisor of Cold Stone Creamery to defend their brand. ”

    The best of franchising? How about the worst? Do you know how many CS locations closed?

    I saw a lot more negative comments from franchisees in the days that followed.

    And of course, now everyone’s stacking up their attorneys.

    Something is wrong with a system if lots of people lose money and go out of business.

    I never saw anything remotely positive about a franchise that costs $350,000 to open, selling $7.00 per person ice cream.

    C’mon Lizette; you’re a franchise insider. Cold Stone was being talked about negatively in blogs and in franchise conferences etc. for years.

    No surprises in that portion of the CNBC Special.

    The Franchise King®

  3. Joel, thank you for your comment. I fully get what you say… Yes, there is something wrong with a franchise business model that does not make profits for the franchisee. And, as we know, during economic crunches weak business models fail to perform; in other words, they are not sustainable and many suffer or die.

    Perhaps I was not clear in my post. I was merely referring to the fact that when franchisees and franchisors (regardless of the system) come together for any reason, in my opinion, that’s when the best of franchising comes forth.

    I was not judging the validity of the CNBC report, nor am I judging the strength or weakness of Cold Stone as a business model. Honestly, I do not have enough information to make those kinds of judgments and if I did make them, they would be merely opinions based on hearsay. And, I rather stay away from engaging at that level.

    Thanks again for your contribution. I always respect your views!