When you start exploring business ownership after a layoff, one of the first questions you’ll face is: franchise or independent business?

Franchise consultants will tell you the answer is obvious — buy a franchise, get a proven system, reduce your risk. But the reality is more complicated. And if you’ve spent 20+ years in corporate management, you may find that a franchise feels less like ownership and more like buying yourself a job — with a fancy logo and a side of regret.

The franchise promise

Franchises offer genuine advantages:

• Brand recognition — customers already know the name
• Proven systems — operations manuals, training, supply chains
• Marketing support — national campaigns you don’t have to create
• Financing — banks are often more willing to lend for established franchise brands

For someone with no business experience, these can be valuable training wheels.

The franchise reality

But here’s what the glossy brochure doesn’t say:

• Royalty fees of 5-8% come off your gross revenue — not your profit. You pay whether you’re making money or not.
• Marketing fund contributions (2-4%) that you have little control over
• Territorial restrictions that limit your growth
• Mandatory suppliers — often at higher prices than you’d find independently
• Limited exit options — selling a franchise requires franchisor approval, and they may take a transfer fee
• You follow their rules. Menu changes, pricing, store design, operating hours — these aren’t your decisions anymore. For a former VP used to making strategic calls, this can feel suffocating.

As Jamie L. Johnston puts it bluntly in Own Your Next Job: many franchisees end up buying a job, not a business.

The independent business alternative

An independent business — a plumbing company, an accounting practice, a distribution business — doesn’t come with a brand name or a playbook. But it comes with something more valuable: 100% ownership and 100% control.

• No royalties. Every dollar of profit is yours.
• No mandatory suppliers. You negotiate your own deals.
• No franchisor approval to sell. You exit on your terms.
• No territorial limits. You grow where opportunity takes you.

Yes, you have to figure out more on your own. But if you’ve run teams and managed P&Ls for two decades, you already know how to do most of it.

Questions to ask yourself

Question	If yes → consider franchise	If yes → consider independent
Do I need step-by-step structure?	✓
Am I comfortable making all strategic decisions?		✓
Do I want to build equity I fully control?		✓
Is brand recognition critical in my market?	✓
Am I OK paying 7-12% of gross revenue in fees?	✓
Do I want to sell without anyone’s permission?		✓
Is this my first time managing anything?	✓

The bottom line

Franchises can work — especially in food service, fitness, and home services where brand recognition drives foot traffic. But for experienced professionals with management backgrounds, an independent business typically offers better margins, more freedom, and greater long-term wealth potential.

Before signing a franchise agreement, read Chapter 4 of Own Your Next Job — it’s one of the most honest assessments of franchising you’ll find in any business book.