30% of Franchisees don’t trust their franchisor is that the same for Network Marketing?

May 9, 2010 by admin · 7 Comments 

A recent survey undertaken by the Griffith University’s Asia-Pacific Centre for Franchising Excellence and backed by the Australian Competition and Consumer Commission –examined the level of research franchisees undertake prior to entering a franchise agreement, and the relationship between franchisees and franchisors.While Australia’s $125 billion franchising sector is growing strongly as the economy recovery gathers pace, the survey suggests there are some fundamental problems with the level of trust between franchisees and franchisors.

Asked whether they can count on their franchisor to be honest in their dealings with them, 28% of franchisees disagreed or strongly disagreed. A staggering 30% said they could not rely on their franchisor to keep their promises, while 30% also said they could not trust their franchisee to “do what is right”.

Yes I would say this is a global trend and TRUE for Network Marketing it maybe even be worse. It’s sad but some Network Marketing companies don’t deserve to be trusted the way they treat distributors. As a Profession we need to communicate together more and exchange information so the dishonest companies can be exposed. In my private coaching and mentoring practice the issue of choosing a company comes up a lot.

Some of the warning signs to look for:

  • Does the ownership respect Network Marketing and are they committed to the industry?
  • Do they allow a distributor to be a free agent and belong to multiple companies or do they want to control you?
  • Do they readily terminate distributors? for no good reason?
  • Do they compete with the field?
  • Are they happy to pay true residual income or do they want you to keep working actively to keep getting paid?
  • Does the company deny being part of Network Marketing ? and pretend to be better
  • Does the compensation plan say “up to x% but they never pay it out as a lot of money is never paid with all the small print and rules.

If you’re concerned talk to an experienced Professional it’s not good business sense to keep working with a company you can’t trust it’s a pity but true. Most companies in our industry can be Trusted and as we have more sharing the bad apples may leave the industry they don’t usually change.

The Franchise industry is growing globally despite the trust issues unfortunately the capital risk is becoming greater leaving a trail of real devastation for those who fail. while Network Marketing has a very low financial risk yet huge potential rewards.

The Profession of Network Marketing is booming it’s a great time to be part of and yes I am convinced it’s the best way to achieve financial freedom for anyone anywhere.

Andries Johannesen

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7 Responses to “30% of Franchisees don’t trust their franchisor is that the same for Network Marketing?”
  1. the franchising business is actually good specially if the product for franchise is well known.:,,

  2. Zoe Ali says:

    Franchising business is good but some franchise needs some cold hard capital to start with.-`~

  3. Bailey Singh says:

    you can earn millions of dolllars by just being involved in a franchising business:”;

  4. franchising is a good way to earn some extra cash and you can also expand your business easily..:

  5. we are also engaged in a franchising business wayback on our home province. the food franchise business is the best.;`

  6. you can earn lots of money if you are into the franchising business. i would love to engage into this kind of business “”"

  7. terrible log you’ve annex

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