$3,997 is a lot of money.
You can buy:
- A couple of really nice men’s suits
- Some nice jewelry
- A big-screen television
- An almost-decent used car or truck
- A Cruise
And lots of other things too numerous to list.
But…
You Can’t Buy A Franchise For $3,997
That’s right.
You can’t buy a franchise for $3997. Not a legitimate one.
Not a franchise business opportunity that provides a solid, proven business system. Or support. Or wonderful technology. Or a ready-to-use marketing system.
No way. No how.
Because if you could, you’d make your money back so fast, you’d be laughing all the way to the bank.
Not to mention all the other people who’d be snapping up franchises left and right, so they too, could get a return on their money, lickety-split, and do all sorts of fun stuff with it.
So, get the thought of being able to get into a franchise business for a few thousand dollars out of your head, like you did when I drew the curtain back on this myth.
You cannot buy a franchise for $3,997.
Low-Cost Franchises: This Is What $3,997 Gets You
Just so you know, I didn’t pull that $3,997 number out of my
The “$3,997 franchise opportunity” I’m referring to is called Phostorian.
It’s a business claiming to be “The #1 fastest growing social network dedicated to preserving and sharing your precious family photos.” It gets better.
From The Better Business Bureau (BBB)
“The company’s website advertised an opportunity to invest in the Phostorian franchise for $3,997. The company’s claim: ‘You will make at least $9000 in your first 90 days or YOUR MONEY BACK!’
According to the company’s advertisement, the investment included a high-speed scanner, laptop, and travel carrying case. The company referred to it as the complete ‘Business in a Box’, which would provide franchisees everything needed to start their own in-home scanning business.”
Fantastic.
In addition, the BBB paid a visit to Phostorian’s 18,000 square foot “headquarters” building and found a vacant parking lot and what looked to be a completely empty office space. And I personally clicked over to their website. It’s gone.
And so is the money several people invested in this “franchise.”
That’s what you get when you buy a “franchise” that only costs $3,997.
“Ethics is not a description of what people do; it’s a prescription for what we all should do.”
– Michael Josephson
Franchise Scams
“Opportunities” like the one I just shared with you, aren’t opportunities at all. They’re scams. The people behind these business schemes not only hurt the consumers who invested their hard-earned money in them-they also hurt the franchise industry. Like this guy recently did.
Others, like less-than-honest franchise consultants, hurt the franchise industry, too. Like when they participate in things they shouldn’t be participating in. Or when they don’t tell their candidates that they’re actually not the client. (The franchisor that’s paying them is.)

A gentle tip from The Franchise King®:
Do not buy a franchise until you know EXACTLY how to do thorough research.
Learn how here
Then there are the franchise salespeople who make illegal earnings claims, hoping to make a sale. Bad!
It’s important for you to know that I used to say that my industry was heavily populated with top-shelf, ethical professionals. But I can’t anymore. I’m starting to feel that the franchise industry is starting to head the wrong direction. (Although there still are ethical franchise professionals around.)
Basically, a combination of greed and desperation are rearing their ugly heads in the franchise industry. And how do I know this?
My clients are telling me.
They’re sharing their experiences with me. They’re sharing the interactions they’re having with franchise consultants and franchise salespeople.
“P.T. Barnum said a sucker is born every minute, but his estimate was laughably low.”
Jonathan Gruber
But don’t you worry. I’m setting them straight. I’m protecting them from harm…from making poor, money-bleeding choices.
In any event, knowing what I know about the industry, and some of the bad players involved in it, franchising is not a scam. You just have to do your homework.
Because there are lots of really good, really profitable franchises around.
Real Franchise Opportunities Cost More
What is a “real” franchise opportunity?
It’s one that:
- Provides a proven business model
- Supplies an operating manual for the business
- Includes proven marketing/advertising materials
- Provides great technology/tools for franchisees
- Offers support for franchisees
- Only awards franchises to qualified candidates
- Focuses on franchisee profitability
- Has a long-term vision for the company
In order to provide those things-and more, a real franchise company has to invest a lot of money up front. And they need to continue to do so for the life of the business.
Update
This just happened.
As I was about to wrap-up the blog post you’re now reading, my phone rang. A gentleman by the name of Allen called to get some help.
He was interested in getting my assistance. He wanted me to help him find a franchise opportunity that made sense for him-in his situation.
But first, Allen told me his story. Of how he was ripped-off by a small-time franchisor in the pest-control industry.
I’m not going to go into details, because he’s presently trying to get some of his investment back, but basically, certain promises were made by the franchisor-and they weren’t kept. And Allen went out of business because of it.
Allen hired an attorney.* But nothing is happening.
*Unfortunately, he didn’t hire an attorney before he signed his franchise agreement. Bad!
Question: If something goes wrong with the franchise you purchased, should you hire an attorney to go after the franchisor?
- Will spending $10,000-$20,000 or more in legal fees get you the result you want?
- Is it worth your time?
- Is it worth months and months of aggravation?
That’s for you to decide.
One more thing.
I told Allen to finish up what he was doing with his attorney, and to get some of his other ducks in a row before we work together. He needs to start with a clean slate.
FYI: Even though Allen was burned by a franchisor, he’s still interested in owning a franchise.
That’s because he believes in the model.
And although we both agreed that there are bad people around, there are good people too.
In conclusion, I’m going to leave you with this:
“Surround yourself with good people. People who are going to be honest with you and look out for your best interests.”
– Derek Jeter
Okay?