To franchise or not to franchise

August 24, 2011
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Experienced entrepreneurs Rick Bravard and Daren Carter thought they were onto something when they came up with the idea of a mobile trailer filled with video games and other entertainment they could rent out for parties.

Turns out their brainstorm came a few years after someone else’s, and now their Greenfield startup Game Guru 2 U is competing against a handful of similar companies that already are franchising the idea nationwide.

The partners remain optimistic, though. As IBJ reported Aug. 22, their one-year revenue goal is $75,000 to $150,000, and they hope to grow the independent business by selling electronics-laden trailers to others looking to capitalize on the $25.1 billion U.S. video game market.

Bravard and Carter don’t plan to offer franchises, though, calling the ongoing fees associated with such enterprises onerous. “That can bite into your bottom line pretty quick,” Bravard said.

Franchisors would argue that the benefits outweigh the costs, since they’re selling a proven concept and the tools they used to achieve success.

Of course, no business is risk-free—especially in the current economic environment. So what do you think: Are franchises the safest bet for small-business owners these days, or is it better to go it alone? Why?

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  1. How can any company that has the cash and other assets be allowed to simply foreclose and not pay the debt? Simon, pay the debt and sell the property yourself. Don't just stiff the bank with the loan and require them to find a buyer.

  2. If you only knew....

  3. The proposal is structured in such a way that a private company (who has competitors in the marketplace) has struck a deal to get "financing" through utility ratepayers via IPL. Competitors to BlueIndy are at disadvantage now. The story isn't "how green can we be" but how creative "financing" through captive ratepayers benefits a company whose proposal should sink or float in the competitive marketplace without customer funding. If it was a great idea there would be financing available. IBJ needs to be doing a story on the utility ratemaking piece of this (which is pretty complicated) but instead it suggests that folks are whining about paying for being green.

  4. The facts contained in your post make your position so much more credible than those based on sheer emotion. Thanks for enlightening us.

  5. Please consider a couple of economic realities: First, retail is more consolidated now than it was when malls like this were built. There used to be many department stores. Now, in essence, there is one--Macy's. Right off, you've eliminated the need for multiple anchor stores in malls. And in-line retailers have consolidated or folded or have stopped building new stores because so much of their business is now online. The Limited, for example, Next, malls are closing all over the country, even some of the former gems are now derelict.Times change. And finally, as the income level of any particular area declines, so do the retail offerings. Sad, but true.

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