What's Wrong With Franchising?

The booming economy has scrambled this once surefire way to expand a business

It's easy to see why Ronald Escoffery wanted to franchise his Premier Learning Centers. The $1 million Atlanta day-care operation was thriving, and he envisioned a chain stretching from coast to coast, cloned without his having to come up with staff or capital himself. So in January, Escoffery, 55, a former banking executive and real estate broker, officially began offering franchises for Premier Learning. To reach that point, he had spent more than a year and over $150,000 in legal, marketing, printing, and other expenses to develop the document--known as an offering circular--that the Federal Trade Commission requires of all franchisers.

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