F is for Franchising
Looking into franchising is one of the most popular and most common ways of entering into the world of business. First time entrepreneurs and even expanding business owners find franchising as a profitable and easily feasible venture. Even people with minimal knowledge about commerce can now start a business once they have identified the right franchise for them.
Before you go around looking for the right franchise, you must have a firm grasp of what franchising really is.
Let us discuss the basics.
As defined by Entrepreneur.com, Franchising is a method of doing business wherein a franchisee is granted the right to engage in the business of offering, selling or distributing goods or services under a system prescribed in substantial part by a franchisor. The franchisor also provides the trademark, the trade name, logo and advertising.
Franchising is a form of a contract. It is an agreement between the Franchisor and the Franchisee outlining what each could do for the other. This agreement usually contains the use of company name, use of the franchise system and franchise fees.
The franchisee is allowed to use the company name of the franchisor. As franchise brands are already established and may already be popular, there is then no need for the prospective entrepreneur to think of a brand. The franchisor is lending its name to you.
Most businesses, even with the vision of a product or a service, still have a hard time initially. This difficulty stems from the complexity of creating a system that works for the business. You would have to create protocols, establish guidelines and implement standardized procedures. It is admittedly a daunting task, especially for people who do not have previous experience in handling or starting up a business. In franchising, the franchisor is lending you a tried and tested system of the franchise brand.
It looks like you are being handed free lunch because everything is ready for you. But franchising is far from free. You would have to pay a franchise fee to the franchisor once the agreement is underway. Franchisors also normally charge royalty fees on a regular basis depending on the agreed terms.
Franchising is a challenge, as with any other type of business. You need hard work to succeed in business. Couple your hard work with our knowledge at Fran Frog and you will find a sure-fire way of achieving your goals. We are not just a franchise consulting agency, we are your family.