No one invests in a business for the purpose of making a loss and it is exactly this reason why people join a franchise system — to build wealth with supported guidance. However, if franchisors are not able to provide an indication of the level of profitability their franchise concept could offer, prospective franchisees won’t have a reason to carry on with negotiations simply because they don’t have the data to make an informed decision.
That being said, franchisors have a responsibility to provide prospective franchisees with accurate and relevant insights into the profitability of the business. In any case, when franchisors try to avoid or provide a misleading answer to this all important question, prospective franchisees could start to wonder that maybe the business isn’t profitable after all and look elsewhere.
See more franchise facts at A-Z Of Franchising!