Looking at Franchises
Looking at Franchises
A franchise is a licence offered by an existing well-established business (the 'franchisor') to others (the 'franchisees') to operate a similar business using the franchisor's fully developed business model, often trading under its brand-name in a defined exclusive territory. In return, the franchisee agrees to operate the business
systems imposed by the franchisor and pays an initial fee. Thereafter the franchisee pays commission to the franchisor, usually calculated as a percentage of sales. Many well-known names offer franchises including McDonald's, Benetton, Prontaprint, Body Shop and others.
What are the advantages of buying a franchise?
As a franchisee you are operating under the wing of the franchisor and will usually benefit from:
* Using a fully proven business model.
* Trading as a well-known brand.
* National advertising arranged by the franchisor.
* Comprehensive training.
* Help with initial set-up.
* Ongoing help and support.
Who is suitable to be a franchisee?
Franchisors target people who have a desire to work for themselves but, possibly never having done so before, would feel more comfortable to have a guiding spirit watching over them to reduce the risks.
Although the franchisor is there to train you, provide all the systems, and give you ongoing support, it is down to you whether or not you are successful.
Like all other business ventures, success in a franchise will require a businesslike approach, hard work and commitment. If you are in doubt as to whether you have these qualities, don't go for a franchise just because you think the franchisor can solve all the problems. He can't and he won't.
The other factor to consider with a franchise is this. The success of the franchisor and all the franchisees as a group depends on everyone following the system and maintaining the standards. Therefore, if you become a franchisee you will have to accept that the way you work, what you sell and how you charge will be dictated by the franchisor, with very little discretion for you to make variations. This is totally understandable. Every franchisee would lose out if each McDonald's or Body Shop you went into was different. Indeed, the most successful franchises are
the ones where the franchisor maintains the closest control. After all, their success depends on the customers always knowing exactly what to expect, whichever outlet they happen to visit. However, for the very entrepreneurial franchisee it can become very frustrating not to be able to make changes or diversify without permission, and to be bombarded with directives from head office, so you must be sure that you can work under these conditions before you buy.
Looking at Franchises - To learn more about this author, visit Timur Sultanov's Website.
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What is a franchise?
A franchise is a licence offered by an existing well-established business (the 'franchisor') to others (the 'franchisees') to operate a similar business using the franchisor's fully developed business model, often trading under its brand-name in a defined exclusive territory. In return, the franchisee agrees to operate the business
systems imposed by the franchisor and pays an initial fee. Thereafter the franchisee pays commission to the franchisor, usually calculated as a percentage of sales. Many well-known names offer franchises including McDonald's, Benetton, Prontaprint, Body Shop and others.
What are the advantages of buying a franchise?
As a franchisee you are operating under the wing of the franchisor and will usually benefit from:
* Using a fully proven business model.
* Trading as a well-known brand.
* National advertising arranged by the franchisor.
* Comprehensive training.
* Help with initial set-up.
* Ongoing help and support.
Who is suitable to be a franchisee?
Franchisors target people who have a desire to work for themselves but, possibly never having done so before, would feel more comfortable to have a guiding spirit watching over them to reduce the risks.
Although the franchisor is there to train you, provide all the systems, and give you ongoing support, it is down to you whether or not you are successful.
Like all other business ventures, success in a franchise will require a businesslike approach, hard work and commitment. If you are in doubt as to whether you have these qualities, don't go for a franchise just because you think the franchisor can solve all the problems. He can't and he won't.
The other factor to consider with a franchise is this. The success of the franchisor and all the franchisees as a group depends on everyone following the system and maintaining the standards. Therefore, if you become a franchisee you will have to accept that the way you work, what you sell and how you charge will be dictated by the franchisor, with very little discretion for you to make variations. This is totally understandable. Every franchisee would lose out if each McDonald's or Body Shop you went into was different. Indeed, the most successful franchises are
the ones where the franchisor maintains the closest control. After all, their success depends on the customers always knowing exactly what to expect, whichever outlet they happen to visit. However, for the very entrepreneurial franchisee it can become very frustrating not to be able to make changes or diversify without permission, and to be bombarded with directives from head office, so you must be sure that you can work under these conditions before you buy.
Looking at Franchises - To learn more about this author, visit Timur Sultanov's Website.
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John PowerJohn Power, founder of Biltmore Franchise Consulting, has extensive experience developing and marketing franchises and business opportunities. He has been in and around franchising for over twenty years. From 1980 through 1990 he conceptualized, organized, and developed the American Video Association. He grew AVA to 2,000 national members, before selling the company it 1990. It was later merged into another home video marketing company. From 2000 to 2005 he worked as a contract marketing and human resources consultant to several local and national companies. In 2005 Mr. Power began working as a franchise development consultant on a full-time basis. Since that time he has helped more than three dozen companies initiate and develop their franchising program. He notes that there are many companies interested in developing a franchise program, and who need his specialized assistance. Mr. Power is a “hands-on” franchise consultant. He said, “I am the ‘nuts and bolts’ person who tends to the details for my clients.” Mr. Power holds a B.S. degree with a major in Marketing. See: www.biltmorefranchise.com You may contact Mr. Power at: jpower@biltmorefranchise.co - Visit John Power's Website |
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