This is sadly true...
But at the same time there is a advantage. There is a reason so many Coffee time and Country Style's are still out there!
Lower franchise cost... The bigger the franchise, the more the cost. The lower the rep, the lower the cost... IF you can manage it well and in a good location, you will turn a profit. Heck... Even the shitty looking Mr. Sub at Vic park and danforth does ok... I know the owner. He's in a low rent location due to the ghettoness of the area. But its also a very busy intersection.
Thats also the reason why those shady looking bars stay in business. Yes your clientele is mostly welfare and disability reciepients. But they buy beer.... Cheap beer at that. They'll even buy the shitty frozen french fries and chicken wings you throw in the deep fryer.
Rent is also low in shady neighbourhoods. Some landlords even let you pay rent month to month... thus high and easily managed cash flow.
CON? You deal with shitty clientele...
Look @ SUBWAY and TIM HORTONS. Amazingly well known franchises. They are EVERYWHERE. But thats also the problem... The operators are now complaining that the franchise is squeezing way too much out of the operators in the name of shareholder profits. Thus... The quality goes down hill