How Many Pitfalls Does Franchise Business Have?
Rough estimates put the cost of preparing basic promotional materials for a project at nearly 60,000 RMB (physical products tend to run a bit higher, while virtual products with labor costs come in around that level). But the real kicker is ad spend and the conversion cost your team can manage—that’s where it gets expensive. Either you drop 200,000 RMB and get absolutely nothing back, leaving you with no choice but to bail, or you finally see some traction only to realize the project isn’t viable. Rarely does anything take off on the first try.
In short, most bosses end up losing between 500,000 and 1,000,000 RMB before they finally call it quits.
Key tip:
Negotiate an annual volume commitment with ad platform account managers, and with rebates you can cut your ad spend by 10% to 20%.
The ideal project is one where you can convert your own friends, family, colleagues, and employees—when that happens, you can confidently scale your ads.