Franchises benefits

The reading states the advantages of the franchising company and provides three reasons of support. However, the professor explains the drawbacks of the franchising company and refutes each of the author's claims.

First, the article claims that buying a franchise ensures reliable suppliers. Moreover, the author states that a major problem when working as a business owner is finding a reliable supplier. However, most of franchise companies have already found excellent suppliers. The professor refutes this point by saying that the franchise forces business owners to buy goods and products in over prices. Moreover, he mentions that a business owner could buy products far cheaper in the market, but they are not allowed by franchise.

Second, the reading posits that people can benefit from franchises because they save money on advertising. Furthermore, the franchise owner gets the advantage of selling products of popular brands, which are advertised and paid by the parent company. However, the professor says that the franchise owners receive less than a six percentage of the sale in advertising, but the franchise is not paying for he/she business, instead it is paying for the company brand and product. According to the professor, the owner of a franchise gets little benefits for advertising.

Third, the article says that a franchise offers more security than any independent businesses. Thus, the failure rate of the franchise business is extremely low. The professor opposes to this point by explaining that although starting a new business can be risky, buying a business with a previous owner is the best options. We also learn that a business with a previous owner offers a twice success rate than a franchise in the first few years.