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AGENDA
ISSUE
Text by Chuck Green with Ben Brody Illustration by Robert Pizzo By Robert Schork
THE PROMISES AND PITFALLS OF FRANCHISING
While opening your own branch of an established company may sound like a sure thing, it’s actually anything but.
AAt a major meeting with his franchisor in 2010, fran- chise owner Tom Fox says he “was experiencing a very emotional time.” His Mamaroneck-based sales- management-training franchise, Sandler Training, was nearly $25,000 in debt because his large corpo- rate clients hadn’t paid for all of the training kits he was required to sell them. To make matters worse, the deficits were putting him behind on his royalty payments to headquarters. Coincidentally or not, the pain of three stressed vertebrae in his back was nearly incapacitating him.
The pressure, the unreasonable goals—he hadn’t expected franchising would be like that. In fact, when Fox purchased his Sandler franchise in 2009, he’d been a successful corporate executive who owned his own training business, but was attracted to franchising, as so many are, because it seemed to
offer an opportunity to be at the top of a business with an already-established strong track record.
He was, instead, surprised to discover that his location put him in direct competition with other Sandler franchises, and that the marketing tools he’d been told were successful—like seeking out golfers who tend to be upwardly mobile and business-oriented—turned out to be duds. Sure, there were supposed to be the training courses and the “coaches” at headquarters who spent up to an hour a week on the phone with him, but he felt as if he’d been sucked into more than he could handle by promises of success and representatives who glossed over important details as part of a sales pitch. “They make it clear that successful franchi- sees make a lot of money and play on your ego that you can do what others do,” Fox says.
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