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This chapter introduces a typology of franchisees that cuts across King Cleaners, Sign Masters, and Star Muffler. The three types of franchisee include neo-franchisees, disillusioned franchisees, and sideliners. Neo-franchisees are outspoken critics of the franchisor and with good reason: most neo-franchisees are successful in the business. They also have full confidence in their abilities and have no doubts that they would be successful as franchisees. Disillusioned franchisees largely believe that buying a franchise was the worst decision they ever made. Sideliners are in some respects the stable backbone of the system. Sideliners are not difficult to manage compared to neo-franchisees and disillusioned franchisees. There are common experiences and uncertainties that led these franchisees to be more alike than dissimilar. Regardless of their profile, franchisees work long hours, operate six or seven days a week, and rarely take vacations.

This chapter reports a detailed account of the nature of work franchisees perform at King Cleaners. It specifically addresses the sources of uncertainty they face. The example given is Larry, who had operated his franchise for five years. Although King Cleaners is one of the leading franchise companies in the world, he still struggled in his franchise unit which appears to be surprising. Larry even provided services at his own expense which was not part of his contract. However, Larry still lost his post. Franchising may offer people with the opportunity to run their own business, but at King Cleaners they often do so on the fringes of the economy. In this precarious position, franchisee operations act as shock absorbers for the corporation.

Franchising has become one of the dominant methods for distributing goods and services in the Western economy. It is an effective solution to the organizational problem of control since there are economic incentives in place to bind franchisee and franchisor to the trademark. In line with this, this book's author participated in the frontline operations of franchisees in three companies, referred to by the pseudonyms of King Cleaners, Sign Masters, and Star Muffler. Then, preformed structured interviews and network analysis with franchisees and with the CEO and other senior executives of each company. It is noted that franchise companies have the problems of having to sell franchise units and provide services to franchisees. Furthermore, this book present a sociological understanding of franchising both to those familiar with the strategy as franchisees or franchisors as well as to those who are familiar with it only as consumers.

This chapter examines three basic components that are features of all franchise systems: royalties, trademarks, and long-term contracts. It demonstrated how these components function and, in particular, how they impact franchisee survival rates at King Cleaners, Sign Masters, and Star Muffler. Competition among franchisees changes the value of the trademark. It is noted that the prices for services given by Star Muffler is a major source of contention among franchisees. Franchisees and franchisors agree that the royalty is a “right” of the company, the price for their expertise, and assumed to be an operating expense for franchisees. The long-term nature of contracts is one of the defining characteristics of franchising, and it is an aspect of the strategy that seems to serve franchisors and franchisees well. Furthermore, it is believed that the short-lived tenure of franchisees is surely due to something other than contracts, trademarks, and royalties.