what are the risks of franchises 
disadvantages include heavy start up costs as well as ongoing royalty costs by definition franchises have ongoing fees that must be paid to the franchisor in the form of a percentage of sales or revenue this percentage can range between 4 6 and 12 5 depending on the industry 2there is also the risk of a franchisee being duped by inaccurate information and paying high dollar amounts for no or low franchise value franchisees also lack control over territory or creativity with their business financing from the franchisor or elsewhere may be difficult to come by and franchisees could be adversely affected by poor location or management 