The primary benefit of franchising is that it leverages the brand and experience of a successful business concept, while the main drawback is the tight control franchisors exert over their franchisees.

Pros
The franchise system provides the benefits of a big company to an individual businessperson. These include:

-Brand awareness and advertising
-Proven business processes and training
-Products familiar to customers

Consider a burger franchise. While opening a small, independent burger stand is fairly easy, succeeding against national chains that benefit from widespread advertising, lower costs through bulk purchasing, and time-tested recipes and procedures presents a very serious challenge. Buying a franchise of the national chain gives you all of those advantages while still letting you run your own business.

Since you represent its carefully-cultivated brand name and image to the public, the franchisor has a vested interest in your success above and beyond the fees you pay them. Because of this, they provide many types of consulting and guidance:

-Considerable expertise to bear on problems such as choosing a site, which can be essential to a retail business.
-An operating manual that can spells out how to effectively run the business
-Sales and marketing help - from ideas, to sample collateral, to assistance in execution
-Occasional seminars and workshops or send consultants to help train your staff

All of these factors combine to greatly increase the success rate of franchises compared to independent businesses.

Cons
To protect their hard-won image, franchisors have very strict procedures and rules. One inherent problem with franchise businesses is that the people most likely to be interested in starting their own business - independent, entrepreneurial, and creative - are also the most likely to feel stifled by the tight control franchisors exert over each local branch. This control can extend to many different aspects of the business:

-Approval of your business location. The flip side of the help they will provide in finding a suitable location is that they may not approve the location you prefer.
-Franchisor-imposed restrictions. A franchisor can place restrictions on the goods and services you can sell, the hours you are open, employee uniforms, and the type of signs outside your business.
-Restrictions on business procedures. That same operating manual that helps you run your business can also spell out specific accounting practices, operating procedures, hiring requirements, and other rules.
-Purchasing restrictions. While there are anti-trust restrictions that prevent franchisors from forcing you to overpay for goods, they can specify the suppliers you must use to outfit your business.
-Territory restrictions. To ensure that their franchises are not competing with each other, the franchisor will define your sales area and may prevent you from moving to certain locations. Or, even worse, they may allow new franchises to open near you, increasing competition for consumers' spending dollars.

While they may seem overly restrictive, these controls are developed from the combined experience of hundreds or thousands of businesses and represent many hard-won lessons.On the other hand, keep in mind that the franchisors' primary goal is to make more money for the company as whole - not for your individual location. As a result, some restrictions may be designed more for the franchisor's benefit than yours.

In addition, franchises can require higher startup costs, which can be difficult for entrepreneurs long on the ability to work hard but short on cash. The upside can be somewhat limited, too -while owning a franchise can help increase your chances of success, you are unlikely to become a mega-millionaire.

Source: BuyerZone.com

Franchise Businesses Buyer's Guide