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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