The concept of responsible franchising was long overdue. For years, the industry focused too heavily on growth at all costs, with franchisors pushing out deals and signing franchisees before ensuring that the right systems, support, and structure were in place. So yes, I’m glad franchising is moving toward a more responsible future. Franchisees deserve it. But the conversation can’t stop there. Because while I believe in responsible franchising, I also believe it doesn’t fully address a deeper root issue — that far too many businesses become franchise brands before they’re truly ready… if at all.

I still remember the words of one of the smartest franchise finance professionals I know. It was more than a decade ago at a conference for emerging franchise brands. Standing before a packed room, he asked a powerful question:
“What makes you think you can recommend someone buy a franchise in your system when your own personal balance sheet wouldn’t qualify you to buy one of your own franchises?”

That moment stuck with me. And it resonates even more today, in a franchising environment that too often celebrates expansion over foundation.

Over the past two weeks, I’ve written two articles addressing responsibility in franchising. The first, The Way Forward in Franchising: Embracing Responsibility, Sensibility, and Sustainability, calls for a shift in mindset. I wrote that franchising has long been celebrated as a gateway to entrepreneurship, allowing individuals to operate under established brands with proven systems. But that model only works when those systems actually exist and can be duplicated. Without a foundation, without the infrastructure, there is no model — just a name and a hope.

In that article, I emphasized three key principles that form what I call the “triple crown” of franchising: responsible franchising, sensible franchising, and sustainable franchising. Together, they set the gold standard. They move the focus from simply selling franchises to supporting long-term success — for everyone involved.

But again, none of these principles matter if the brand isn’t franchise-ready in the first place.

In my second article, published just yesterday, Restaurant Growth Reality: The 10X Business and $3M Franchise Brand ‘Long Shots’, I tackled a troubling trend. There’s a narrative floating around online that if you have a $1M restaurant, franchising can magically turn it into a $3M brand. And yes — it can. But just like weight loss ads that promise you’ll drop 100 pounds by joining a gym, it’s technically true… but rarely the outcome for most.

Franchising is not a shortcut. It is not a get-rich-quick scheme. It is not a shiny object to chase.

Franchising is a serious business. It’s a new layer of your company — and one that completely shifts your role. You’re no longer just running a restaurant or a retail store. You’re building and managing an entirely different business: a franchise system. That means documentation. That means infrastructure. That means legal compliance, brand standards, training, marketing, supply chain logistics, financial modeling, franchisee support, and more. If you can’t yet hand someone the keys to your system and guide them to success, you are not ready to franchise.

It’s why the idea of responsible franchising, while valuable, must be accompanied by franchise readiness — the willingness to hold back until your business is truly structured for replication. Because responsibility doesn’t begin at the point of signing a franchise agreement. It starts much earlier, with the decision of whether or not to franchise in the first place.

And that’s the conversation we need to be having more often. Not just about how we treat franchisees once they’re in the system — but whether we’re creating systems worth joining in the first place.

Closing the Gap in Responsible Franchising: Readiness Must Come First

I do believe the International Franchise Association’s Responsible Franchising initiative is a strong and commendable step in the right direction. It highlights key areas of the franchise relationship — the franchise sale, training, onboarding, ongoing support, and the mutual respect that must exist between franchisor and franchisee. I highly recommend reading it. It checks many of the right boxes and it was, without question, long overdue.

But even with all its strengths, there’s a noticeable gap — and it’s a big one.

The initiative makes no mention of whether the franchisor itself is qualified to franchise — not just legally, but operationally and financially. Yes, a company may be compliant with franchise disclosure laws. It may be properly registered in required states and have a Franchise Disclosure Document that checks all the boxes. But that doesn’t mean the business is actually ready to franchise.

That’s where responsible franchising — as defined today — falls short.

To truly be responsible, franchisors must be held to a standard that goes far beyond regulatory compliance. They must be able to answer the hard questions:

Is the business model proven through consistent profitability?

Is it replicable across different markets?

Does the franchisor have the financial wherewithal to train, support, and protect its franchisees?

Can the brand deliver value through the entire term of the franchise agreement?

Is there a legitimate path for the franchisee to realize a return on investment?

Without positive answers to these questions, any claim of “responsible franchising” is only surface-level. It misses the foundation. It skips over the most critical part of the equation: the franchisor must be franchise-ready.

And that’s the conversation that’s missing from the IFA’s initiative — and from too many industry discussions.

This isn’t just a gap. It’s a fault line that separates intent from reality. Without a bridge between regulatory compliance and true operational readiness, that gap will only grow. The danger is clear: brands will continue to franchise before they’re ready, franchisees will struggle or fail, and the entire concept of responsible franchising will lose credibility before it ever fully takes hold.

So how do we close that gap?

It starts with honesty. Franchisors — especially emerging brands — must take a hard look in the mirror. They need to ask not just can we franchise, but should we? And the industry must do a better job of supporting this kind of self-assessment before promoting growth.

Franchise consultants, brokers, and advisors (yes, me and my organization included) need to be held to a similar standard. They (we) should help brands build readiness before pushing them to market. They (we) must be willing to say no when the foundation isn’t strong enough.

And the IFA — and other industry leaders — should expand the definition of responsible franchising to include franchisor readiness as a core principle. Because without it, we’re putting franchisees into systems that may never give them a fighting chance.

Responsible franchising isn’t just about what happens after the deal is signed. It’s about making sure the deal should have been made in the first place.

That’s how we close the gap. That’s how we build the bridge. And that’s how we ensure responsible franchising truly lives up to its name.

Seeing the Forest: A Perspective on Guiding the Way Forward

From my perspective — and with more than 40 years of experience in franchising — I’ve seen the good, the bad, and everything in between. I’ve witnessed the shortfalls firsthand, not just from the outside looking in, but from the inside out. With brands I was employed by, or those I supported as a consultant, I was often right in the thick of it. Sometimes, despite good intentions, despite effort and passion, we simply didn’t see the forest for the trees. Yes, I’m saying, we!

Oh, how I wish I knew then what I know now.

Franchising, like any complex business model, has layers that only time and hard-earned lessons can reveal. Experience brings clarity — and sometimes, humility. It’s only with distance that we can truly see how rushed decisions, underdeveloped systems, or overzealous expansion strategies created problems that were avoidable.

That’s why my focus today is very different.

Now, I intentionally take a step back from the forest. I’ve made it my mission to help franchisors, franchise development professionals, and franchise candidates navigate the journey more carefully — with eyes wide open and with a mindset rooted in evaluation, responsibility, and refinement.

We don’t race through the forest anymore. We stop along the way. We look around. We evaluate the path. We make adjustments.

And most importantly, we build systems — and relationships — that are responsible, sensible, and sustainable.

Those three principles aren’t buzzwords to me. They’re a filter I use with every brand and every professional I work with. Are we being responsible in how we present opportunities? Are we being sensible in how we grow? Are we creating something sustainable that benefits everyone — franchisors, franchisees, and the brand itself — for years to come?

It’s not about perfection. It’s about awareness. It’s about learning from the past to guide a better future.

Because franchising still offers one of the greatest paths to entrepreneurship and business growth. But only when the journey is taken with care, with eyes on the bigger picture, and with a willingness to stop, assess, and do it right — every step of the way.

But sadly, mistakes are still being made. It certainly weighs on me. As I’ve said before, I’ve been right in the mix. Hindsight is always 20/20. Looking back, there were definitely a few instances where I wish I had answered no when asked, “Is my business ready for franchising?” The truth is, just because you can franchise doesn’t always mean you should. That’s exactly why I stay committed to making tomorrow better than today.

I truly believe in franchising — it’s one of the greatest business models when done right. Because of that, I’ll continue to provide valuable resources for all stakeholders and work diligently to shine the brightest spotlight on franchising, doing everything in my power to ensure there are genuine, positive reasons for that spotlight to shine.

To everyone involved in the Responsible Franchising initiative, I say thank you — but please, let’s not stop there.

Make today a great day. Make it happen. Make it count!

About the Author

With more than 40 years of experience in small business, restaurant, and franchise management, marketing, and development, Paul Segreto is a respected expert in the entrepreneurial world, dedicated to helping others achieve success. Whether you’re an aspiring or current entrepreneur in need of guidance, support, or simply a conversation, you can connect with Paul at paul@acceler8success.com.

About Acceler8Success Group

Acceler8Success Group empowers entrepreneurs and business leaders with personalized coaching, strategic guidance, and a results-driven approach. Whether launching, scaling, or optimizing a business, we provide the tools, mentorship, and resources to drive long-term success.