Franchising has long been a popular pathway for aspiring business owners and investors. However, the world of franchising is shrouded in myths, leading many to have misconceptions about what it truly entails. These myths often prevent people from considering franchising as a viable business model or entering it with the right expectations.
Whether you’re a potential franchisee or simply curious about franchising, this blog will demystify 10 common franchise myths to help you make informed decisions.
1. Franchises Are Expensive – Franchises Are Only for the Rich
Myth
Many assume you need to be wealthy to own a franchise, but there are opportunities at various investment levels. From low-cost service franchises to home-based models, franchising is more accessible than most people think.
Truth
While some franchise options require significant investment, not all franchises come with a hefty price tag. Many franchises are available at entry points, making them accessible to people with modest capital. Additionally, costs can vary based on factors like industry, location, and brand recognition.
For instance, mobile service franchises, home-based franchises, and smaller niche concepts often require lower initial investments than large fast-food chains. Many franchises also provide resources like financing plans or partnerships with lenders to assist new franchisees.
According to a recent study, For the most popular fast food franchises, start-up costs range from $10,000 to well over $1 million, and monthly fees, which are typically calculated as a percentage of gross sales, generally hover around the 5 percent mark, but can be as much as 50 percent.
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2. Franchising Is Limiting – It's for People Who Can’t Start a Business on Their Own
Myth
Many assume franchising is a fallback for those lacking creativity or ambition. In reality, it’s a strategic choice that combines independence with the support of a proven system.
Truth
Far from being the "easy route," franchising is a strategic choice that allows entrepreneurs to leverage a proven system and established brand. Franchise owners still operate as business leaders, managing day-to-day operations, building customer relationships, and implementing marketing strategies.
Owning a franchise isn't about avoiding hard work; it's about reducing the risks of failure by following a tested business model, which is especially appealing for entrepreneurs seeking a balance between independence and support.
3. Franchising Is Narrow – It’s Just Fast-Food and Retail Businesses
Myth
Many people associate franchising only with burgers and storefronts. In reality, franchises span industries like education, fitness, home services, healthcare, and even B2B services—far beyond just food and retail.
Truth
Franchising spans a wide range of industries beyond fast food and retail. From healthcare to education, cleaning services to fitness studios, and even pet grooming, there’s a franchise opportunity in virtually any sector you can think of.
For instance, tutoring services like Kumon, fitness brands like F45 Training, and cleaning companies like Molly Maid have built robust franchise models. This variety makes franchising an option for aspiring business owners passionate about diverse fields.
4. Franchising Is Not for Newbies – You Need a Lot of Experience to Run One
Myth
Many believe only seasoned entrepreneurs can run a franchise successfully. In reality, most franchisors offer training, resources, and ongoing support designed specifically for beginners.
Truth
Most franchisors don’t expect you to come in with extensive experience in business or the specific industry. Instead, they look for motivated individuals willing to learn and adhere to their systems. Many franchisors provide comprehensive training and ongoing support to help you succeed.
For example, cleaning franchises or fitness studios often train franchisees from the ground up, even if they lack prior experience in those industries.
5. Franchise Ownership Kills Creativity – You Can’t Be Original if You Own One
Myth
Many assume franchises are rigid and leave no room for innovation. While you must follow brand guidelines, there’s still space for creative problem-solving, local marketing, team building, and customer engagement.
Truth
While franchises provide guidelines to ensure brand consistency, franchisees still have room to individualize their businesses. For instance, you can tailor customer engagement approaches, build unique community relationships, or implement local marketing strategies.
The key is balancing creativity with adherence to brand standards, ensuring the customer experience aligns with the franchisor’s reputation.
6. Franchisors Are the Only Winners – They Just Get Rich Off Royalties
Myth
Many assume franchisors only care about collecting fees and royalties. In reality, their success depends on the franchisee’s success—strong performance across locations helps build the brand and long-term profitability for both parties.
Truth
Franchise fees and royalties are reinvested into the brand to provide essential services like marketing, product development, tech support, and training. These resources help franchisees grow and succeed.
When a franchisee thrives, so does the franchisor—the relationship is symbiotic, not exploitative.
7. Franchisees Work Harder – It’s Tougher Than Running a Regular Business
Myth
Some believe franchisees have it harder due to strict rules and brand standards. In reality, franchising offers a proven system and support network, often reducing the trial-and-error and stress that comes with starting a business from scratch.
Truth
Running a business—franchise or otherwise—requires dedication and effort. However, because franchises come with established systems, supply chains, and marketing support, much of the initial legwork is significantly reduced. Franchisees often benefit from quicker setup times and more streamlined operations than independent startups.
8. Franchise Agreements Are Set in Stone – There’s No Room for Negotiation
Myth
Many assume franchise contracts are non-negotiable, but that’s not always the case. While some terms are fixed, others—like territory, fees, or support—may have room for discussion, especially with newer or growing franchisors.
Truth
While franchise agreements are standardized to ensure brand consistency, there may be room for negotiation in specific circumstances. For instance, certain fees, territory rights, or renewal terms can sometimes be discussed. Consulting an experienced franchise attorney can help clarify what’s negotiable.
9. The Franchisor Is Always to Blame – It’s Their Fault When Franchisees Fail
Myth
It’s easy to point fingers at the franchisor, but failure often results from poor management, lack of effort, or local market issues. Franchisees play a major role in their own success or failure.
Truth
While franchisors provide the tools and support needed for franchise success, the franchisee’s execution plays a significant role. Lack of local market research, mismanagement, or failure to follow the franchisor’s proven systems can often lead to challenges. Franchising works best when both franchisor and franchisee actively collaborate toward success.
10. Only Big Brands Matter – You Should Only Choose a Well-Known Franchise
Myth
Many assume that choosing a famous brand guarantees success. However, lesser-known franchises often offer more support, better territory options, and lower entry costs—making them a smarter fit for some entrepreneurs.
Truth
While well-known brands may offer greater brand recognition, they are not always the best fit. New or niche franchises often provide unique opportunities with less saturation in the market. Additionally, smaller franchises may offer lower initial costs and more personalized support. The key is aligning with a franchise that resonates with your goals, values, and local market needs.
For instance, emerging fitness brands or specialized coffee shops may not be household names yet, but can offer lucrative opportunities due to increasing demand in those markets.
McDonald's: The Ultimate Franchise Success Story
McDonald’s started as a single restaurant in San Bernardino, California, in 1940, owned by Richard and Maurice McDonald. The brothers developed a unique "Speedee Service System," which streamlined food preparation and reduced wait times.
In 1954, Ray Kroc, a milkshake machine salesman, saw the potential of their system and proposed expanding it as a franchise. He opened the first McDonald's franchise in Des Plaines, Illinois, in 1955. Kroc later purchased the company from the McDonald brothers and aggressively expanded it.
Impact Today:
- As of late 2024 and early 2025, McDonald's has expanded to more than 43,000 locations globally.
- McDonald's operates in more than 100 countries worldwide.
- The United States has the most McDonald's locations, with over 13,000.
Franchising Can Be the Right Choice—If You Do It Right
Franchising provides aspiring business owners with a structured path to entrepreneurship, offering support and proven systems that make business ownership more accessible. However, to make informed decisions, it’s crucial to separate fact from fiction. By debunking common franchise myths, you can confidently explore opportunities that align with your goals.
If you’re considering franchising, thorough research, expert guidance, and choosing the right partners are essential. At NY Engineers, we specialize in MEP design for franchises, ensuring your restaurant, retail store, or commercial space meets all operational and compliance requirements. From energy-efficient HVAC systems to optimizing plumbing and electrical layouts, our team helps create a seamless, cost-effective design tailored to your franchise's needs.
