Joel Libava
Frankly, it’s so confusing, I had to read the post twice. The very-well branded Charles Schwab financial services empire has decided to take a shot (invest) in some franchise development efforts, but I’m not really sure why.
Don’t get me wrong; I’m all for creating opportunities for people to become franchisees, so that they have a shot at the American Dream. In the case of Schwab though, it seems like the people they’re trying to recruit to become Schwab franchisees are already on their way to doing so, albiet under a corporate structure.
According to a recent post by Investment News, Schwab plans to split revenue fifty-fifty with established franchisees. The question posed by the writer of the post is a good one. In my own words, it’s this; Why would someone who’s running a financial services office already, and who’s not paying any overhead, want to pay an up-front franchise fee, split their revenue fifty-fifty, and pay for things like rent and salaries?
I find it strange that a company with a seemingly good reputation in the retail investment category would be trying to sell an investment which sounds to me like one with a really low return.
Maybe I’m missing something. Look at the Schwab franchise brochure
If I happened to be an independent investment professional, the thought of having the Schwab name behind me would be very attractive.
But, for a fifty-fifty split, an upfront franchise fee, and high monthly operating expenses?
If you, or someone you know is contemplating the purchase of a franchise, I offer brain-picking services, which in this case, may be needed…
