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Wednesday, December 13, 1989 TERRACE BAY/SCHREIBER NEWS Page 9 = a st x she = good and Entering the marketplace by operating a franchise can be one of the best ways for the new entrepreneur to launch a success- ful business. It enables, those with limited business experience to utilize the highly developed management, marketing and purchasing skills of a large company with proven experience in its field. The entrepreneur, given a proven for- mula and a management system, has an excellent opportunity to succeed. Assuming that the franchisor's system is followcd, the risk factor is ceduced dramatically. The arrangemcut is covered by contract and the franchisor usual- ly charges a franchise fee (one time), plus a royalty on sales. The package may alsv include other itcms such as personnel training, assistance in advertising, leasing, financing, the use of its trade- marks/logos, supply of product or equipment and management training. It will also permit the fran- chisee to use the company name, which, if well known, is a major asset in establishing a new busi- ress, The number of restrictions imposed will vary greatly, 'lepending on the product or ser- vice being franchised. There are both good and bad points to franchising though it is of greatest appeal to the conser- vative entrepreneur. Franchising, by its nature, places certain restrictions on the franchisee. The franchise agreement may restrict the products which may be sold, the area of operation, the outlet's physical appearance and its methods of operation. These limitations may be too severe for the entrepreneur who wants to implement innovative ideas as the business develops. Other risks include: 1. The possibility. that the fran- chisor does not live up to expec- tations. In particular, the fran- chisor may turn out to be underfi- nanced, inexperienced or lacking in integrity. 2. Trademarks and tradenames may not bring in the volume of business expected. In addition, the franchisor may not have legal title to the trademarks or trade- names which the franchisee has purchased the rights to. 3. Often, franchisees underes- imate the amount of hard work involved, particularly in the early years, to get the outlet started. 4. The market may become oversaturated by the franchisor or by competitors. 5. Profit and cash flow projec- tions may have been overly opti- mistic and perhaps unrealistic. 6. Some franchise agreements are so complex that there is con- Franchising has its bad sides stant concern as to what can or cannot be done. A lawyer can help sort out some of the key questions. 7. Services, inventory and equipment which the franchisor provides per the agreement may well be available elsewhere at lower prices. 8. The franchisee may be locked into buying services from the franchisor which may be of no value. Franchising has proven to be a very successful method of dis- tributing products or services for many companies and has provid- ed many individuals with the opportunity to own their own business. Although franchisees are self- employed, they must conform to someone else's pattern of doing business. The degree of success achieved will depend to a very large extent on the franchisce's ability to operate as part of a team and a willingness to follow proven methods of operation as laid down by the franchisor. Co-operation is easy at the beginning, but as the franchisee acquires experience, there is often a tendency to resent outside guid- - ance. This is the time to talk things over and possibly renegoti- ate the terms of the franchise agreement with the franchisor. However, the well-earned and publicized success of franchise operations has attracted a number of unqualified and unscrupulous promoters whose intentions may simply be to sell as many fran- chise agreements as possible before disappearing into oblivion. The Ministry of Consumer and Commercial Relations issues a booklet entitled Facts about Franchising. It outlines the prop- er way to go about checking out a franchise/franchisor and the con- cept of franchising Here is a summary of both the advantages and disadvantages of franchising. Advantages 1. best chance of success 2. total business package 3. proven formula 4. marketing program with associated product and business trade name 5. buying discount 6. management training 7. very often careful local mar- ket analysis and territory protcc- tion i 1. high cost entry franchise fee plus franchisor's equipment 2. ongoing royalty 3. no' deviation from set busi- Ness standards 4. limited scope for growth without purchasing a second fran- chise NOS Program wonders what young people want By Jan Mah Community Development Worker In the short space of time I've becn working in your community (7 months), a growing concern for the youth of the communities and their parents has been expressed. Parents struggling with the independence of thcir tecns, and tccns struggling to "get their wings", seems, at times to threat- en the long-term relationships between children and their par- ents. If there are alcohol or drug problems as well that have to be dealt with, the task of coping sccms next to impossible. "What do young people want?" is a question many parents and adults are asking these days. C. Richards has the following to say: What do young people want? They want to be autonomous persons with intcgrity, Who are cherished contribu- tors to the development of com- munity life. The time has come for adults to put themselves on the line As partners in action For communities worthy of The potentials of youth. Young people do want to be included In the life of Society. Not in the nurturing sense As children, But, as persons recognized as capable of managing their lives And, of contributing creatively To the community. : "What do young people want?" Deadline For all classifieds, advertising and editorial submissions is Thursday at 5 p.m. Please help us during this busy season and throughout the year by adhering to this schedule. Your cooperation is appreciated. Plus tax where applicable. May not be the right question. Perhaps, what is more relevant For a Democratic Society Are the questions: "How can we (adults and teens) be most helpful to each other?" "How can we assure each per- son increasing opportunity to develop as an individual, and as an active participant in a Democracy?" If you have any thoughts about the youth in your community, or have a story of your own you would like to share, speak with another parent in your community or call me at 824-2867. Some parents are presently meeting at the Terrace Bay Rec Centre. More information is available if you are interested. While quantities last.