Master Franchises Explained
Master Franchises Explained
What or who is a master franchise?
A master franchise can be a person or a business entity who buys the right to promote and sell units of a franchise in a specific area.
Sounds like an Area developer. What is the difference?
The biggest difference is that unlike an Area Developer, a master franchise is not bound to open and maintain units. He or she can open one unit for training or as a model unit; but his or her prime focus is to spread the name of the franchisor in the chosen market. A master franchisor also gets to keep a part of the franchise fee and royalty fee that people who buy a franchise pay to the franchisor. Also, a master franchise is supposed to train the people like a main franchisor in many cases.
Sounds good, can I get one?
Since the function of a master franchise is like a franchisor, only experienced people are considered as master franchisees. Then again, not all franchise opportunities offer this program. Many times, international franchises use it to spread faster in a new country. Also, your net worth has to be really good to qualify as a master franchise.
How big will be the area?
It can be anything between a state and a country! Among different franchise business for sale offers circulated by a franchise concept, a master franchise has the largest area. If the master franchisee opens the required number of units within a given time-frame, the area is more or less exclusive.
How is the return of investment?
A master franchise has more than one channel of earning. Besides getting a part of the franchise fee and the royalty fee, the master franchise can earn from the unit it decides to open (it also gets reduced opening fees when it opens a unit of its own) and also by distributing products to the franchisees. Additionally, it can also have real estate interests.
Master Franchises Explained - To learn more about this author, visit Michael Hemenway's Website.
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hile looking at different franchise business for sale offers, you must have come across the term “master franchise”. If you are wondering what it is, here are the details:
What or who is a master franchise?
A master franchise can be a person or a business entity who buys the right to promote and sell units of a franchise in a specific area.
Sounds like an Area developer. What is the difference?
The biggest difference is that unlike an Area Developer, a master franchise is not bound to open and maintain units. He or she can open one unit for training or as a model unit; but his or her prime focus is to spread the name of the franchisor in the chosen market. A master franchisor also gets to keep a part of the franchise fee and royalty fee that people who buy a franchise pay to the franchisor. Also, a master franchise is supposed to train the people like a main franchisor in many cases.
Sounds good, can I get one?
Since the function of a master franchise is like a franchisor, only experienced people are considered as master franchisees. Then again, not all franchise opportunities offer this program. Many times, international franchises use it to spread faster in a new country. Also, your net worth has to be really good to qualify as a master franchise.
How big will be the area?
It can be anything between a state and a country! Among different franchise business for sale offers circulated by a franchise concept, a master franchise has the largest area. If the master franchisee opens the required number of units within a given time-frame, the area is more or less exclusive.
How is the return of investment?
A master franchise has more than one channel of earning. Besides getting a part of the franchise fee and the royalty fee, the master franchise can earn from the unit it decides to open (it also gets reduced opening fees when it opens a unit of its own) and also by distributing products to the franchisees. Additionally, it can also have real estate interests.
Master Franchises Explained - To learn more about this author, visit Michael Hemenway'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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David BarrDavid Barr is the President of Venture Opportunities, Inc. David has been a professional business broker/intermediary since 1980 focusing on General Business Brokerage and Mergers and Acquisitions representing client transaction value from $400,000 to $20,000,000. Mr. Barr has handled the sale of over four hundred and fifty companies. David earned a university degree from the State University of New York majoring in economics and business. David holds the Mergers and Acquisition Master Intermediary and the Certified Business Intermediary designations from the International Business Brokers Association. He is also a Senior Business Analyst and a Texas licensed Real Estate Agent. For more information about David and Venture Opportunities, visit www.bizdealmaker.com. - Visit David Barr's Website |
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