Franchises are often promoted as a means of reducing the financial risks of business ownership. A small but persuasive body of academic research shows that franchised small businesses often have lower profitability, higher costs and a greater risk of business failure in their first five years of operation when compared to similar but non-franchised small businesses. This is not necessarily true of all franchise offerings. Still, it underscores the need for the investor to be diligent in investigating a franchise