Customer Reviews

Franchising from the Inside Out

5 star:		(2)
4 star:		(0)
3 star:		(0)
2 star:		(0)
1 star:		(1)

 

 

" I've read a number of articles and magazines regarding buying a franchise however this book gave me the information I was looking for in a very organized way. It showed me the steps to follow and I didn't have to deal with pre-conceived notions about different franchises. I really liked the chapter about negotiating the franchise agreement since I didn't know very much about that subject. I highly recommend this book for someone looking to buy a franchise."

I didn't find the book justified its cover price as I didn't feel the author wrote this to help franchisees although he had some sage advice. Instead, the author has worked for Franchisors and he has that mindset. The reader should know that up front and take what he has to say with a grain of salt.

Teixeira dangerously explains how to negotiate less significant areas of the franchise agreement such as renewal terms while justifying the franchisor's position not to negotiate other CRITICAL aspects such as termination clauses. This can trap unsuspecting franchisees in a system of indentured servitude for the term of the contract even though the franchisor breaches the contract! Amazingly, to top this off, the author admits never taking a franchisee's house through litigation while implying he was justified to take everything else of value.

He also fleetingly mentions that franchisees should expect to accrue equity in their franchise operation from the many years of building the business but it is well known that franchisors often won't allow that to happen. In fact, the author devotes some pages explaining how the franchisor may buy the business for below market value and is justified in doing so.

In addition, he doesn't differentiate business format franchises from product franchises (e.g. distribution franchises for Chevrolet, Coca-Cola, Budweiser, etc). He discusses how franchisees should expect the franchisor provide what they are obligated to provide in return for 5-7% royalty payments. This makes it sound like the franchisee receives a recurring tangible product or service from the franchisor when they do not. In fact, the majority of franchisors merely provide trademark licensing and a process of closing a sale. As can be expected, many franchisees of these business format franchise systems become disillusioned very quickly.

In order to fairly balance the decision making process, any prospective franchisee owes it to themselves to buy the Purvin book called Franchise Fraud. You won't get that balance from the Teixeira book alone.

This book told me exactly what I needed to know. It was easy to understand and gave me the right way to look for a franchise.

Outstanding resource!