Own a Franchise or Manage a Company Store...Any Preference?

The previous post asks a hidden question that I'd like to answer here. What is the difference between a franchisee and a company owned store within a franchise chain? The entrepreneurial spirit tends to lend itself more to the franchisee, because the national chain give a varying degree of freedom to the "owner" (as opposed to "manager") of the store. Take Wendy's for example. A franchisee store may allow it's owner to operate on a smaller staff so long as consistency doesn't suffer, increasing the bottom line and allowing more profits to go directly into the owner's pocket. Franchises can also grow and in many cases one owner can own multiple stores--allowing for even greater profits.

The downside to a franchise operation versus a company owned store is risk. Ownership demands more money, more time, and the ever-present risk of failure. It is critical that the national chain allows the owner of the franchise store the ability to adapt to local market conditions. If this is not possible, perhaps management of a company owned store is the right way to go. It could also be that an entrepreneur lacking a risk-taking bent would be very happy in the safer (though less profitable) world of company-owned store management.