Having had the good fortune of working in the franchising community for 25 years, I have come to define very personally the concept of franchising. When trying to define a term or concept it is important to understand what it is not.
Franchising is not an industry. Too often I hear people talk about the industry of franchising. It is like referring to joint ventures as an industry, or subsidiary operations as an industry. Franchising is not a guarantee for success. No business can guarantee a successful outcome. Franchising is not a “get quick rich” scheme. It is a business that requires patient capital. So if that is what franchising is not . . . what is it? What is franchising? Franchising is a method of growing a proven business model into a brand name. My personal definition of franchising includes five key elements.
1. Franchising is a business of numbers. It is about creating dominance in the marketplace. The fastest way to develop a brand in a particular market area is with number of units. The more units the greater brand recognition and market dominance prevails. The synergy created by each franchisee contributing to developing the brand returns value to each franchisee participating. The greatest advantage to franchising is that it can accelerate growth, develop a brand faster than almost any other method.
2. Franchising is the business of consistency. Consumers develop an appreciation for the product and service and learn to have confidence that the product and service is consistent through the chain. The franchisor develops a system to deliver that product or service consistently; it looks to each and every franchisee to implement that system. A successful franchise system is constantly seeking ways to improve the consistent delivery of product and service the consumer has grown to expect.
3. Franchising is the business of risk minimization. Since the prospective franchisee is bringing their capital, time and effort to an already proven business model, success is much less risky than when that franchisee trys to do things on their own.
4. Franchising is the business of mutually beneficial relationships. All parties must participate in the fruits of their labor equally. Franchisees must generate sufficient profits and returns on their investment to continue to develop and grow their business, Franchisors must do the same to be able to continue to invest and grow the numbers and brand, and Consumers must get value for the products and services they receive.
5. Finally, franchising is a lifestyle. Someone who goes into their own business is different from someone who wants the protection of a well-established business which employs them.
Franchising represents a more viable approach to business ownership. For a price, the franchisor teaches its proven business methods to the franchisee who shoulders all operating and financial responsibilities of the outlet.
What is franchising? My personal definition! - To learn more about this author, visit Jim Coen's Website.
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Jim Coen
(Visit Jim's Website)
With 25 years of franchise, marketing, and
entrepreneurial experience, and the owner
of Franchise Perfection, Jim Coen, brings
key skills to franchise consulting for
those interested in buying a franchise
business opportunity.
At Franchise Perfection we serve as
franchise consultants and advisers,
“matching you with the perfect business”.
Visit: www.franchiseperfection.com/ind
ex.htm
For over 20 years Jim worked with Super
Coups. which is a MA based direct mail
franchise that delivers money saving
coupons from local businesses to your
mailbox. His responsibilities at Super
Coups included: franchise marketing,
franchise training, sales management,
regional sales, and director of Franchise
Development.
Prior to Super Coups Jim successfully
marketed franchises in the New England
area for Uniglobe Travel Northeast a
travel franchise, Merry Maids a maid
cleaning franchise, & Emack & Bolio an Ice
Cream franchise.
Jim recently was the host of a popular
radio show called “Let’s Talk Franchising”
that aired on WBIX 1060 in Boston.
Jim currently serves on the Board of
Directors of the New England Franchise
Association (NEFA) www.nefranchis
e.org
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Let's Talk Franchising! - I have learned franchising from the ground up. I’ve been a franchisee for a bad franchisor. I’ve worked for good franchisors and I’ve worked for marginal franchisors. I’ve helped many franchisees succeed.
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