Q.State two disadvantages of Franchising.

Franchising limits the franchisee's independence and involves heavy fees and royalties; these are two important disadvantages.

While franchising allows a person to trade under a proven brand and system, it carries drawbacks for the franchisee. Two clear disadvantages:

• Lack of freedom / independence — the franchisee must strictly follow the franchisor's rules, methods, prices and standards, and cannot make his own decisions or change the way the business is run. He is, in effect, controlled by the franchisor.
• High cost — the franchisee has to pay an initial franchise fee and then a continuing share of sales (royalty) to the franchisor, which reduces his own profit and can be a heavy financial burden. …