Franchise — An Opportunity Worth Grabbing

1. Franchise — An Opportunity WorthGrabbing Franchise Business In today’s globalized, commercialized and technologically advanced time, it is almost impossible to ignore some of the giants in the world of business. They walked the extra mile, established their brand name locally and then step by step, setup chains of their respective showrooms, restaurants, café to distant geographical regions. And it is needless to say, that managing and keeping an account of all the outlets around the world could be called anything but practical, although some of the major brands own their outlets or chain stores. Another alternative that helped companies with sufficient brand value, achieve their reach to masses and further strengthen their brand value with little investment was FRANCHISING.

2. What is “franchising”? Franchising can be explained as a marketing concept or a business expansion plan, in which the franchisor of a brand licenses its procedures, business model, intellectual property, brands and rights to sell its products and services to the franchisee, which is a separate, independent business party. The franchisee in return pays a prescribed fee to the franchisor, in order to buy the rights to use the brand’s name, trademarks, etc. Although a franchise is a joint venture between the franchisor and the franchisee, it is not an equal partnership, as the franchisee buys the rights and trademarks, whereas, the franchisor owns the same. Terms and conditions set by the franchisor are to be compiled by the franchise in order to the smooth functioning of their franchise.

3. Types of Franchise: Before answering the big question, understanding the types of franchises could help the reader to make the right decision. Franchise Business

4. 1. Product Franchising- It is probably one of the oldest forms of franchising. Franchises under this category, the producer or manufacturer give the right to distribute their products to a dealer. The dealer has to pay a franchise fee, beforehand, to buy these rights. Nowadays, this form of franchising is a common practice in automobiles and petroleum industries. 2. Manufacturing Franchising- The name says it all. The franchisor gives exclusive rights of production and distribution of their products in a particular area to the dealer. This type of franchising is common practice beverage and soft drink manufacturers. 3. Business- format Franchising- Unlike, the prior two franchising categories, this one, is the modern version of franchising. This is what people mean to imply, when they use the term, franchise, in modern times. The franchisor, under this category, provides the franchise, with different services, such as marketing, training, standards and quality control guidance, which helps the latter to set up their startup effectively and efficiently.

5. The BIG Question Enters the big question- “How to Find a Franchise Startup with Potential” Is there any right way or procedure to choose the right type of franchise startup? There is always a right way to do everything, and finding a potential franchise is no different. Any small business owner who is planning to invest in a franchise would find these points helpful-

6. Franchise Business 1. Choose- The first step is for you to choose. Which type of franchising would you like to invest in- Product franchising, manufacturing franchising or business format franchising? Then comes choosing the category of the franchise, such as restaurant franchise, sports franchise, automobiles franchise, beauty, and health franchise or even education franchise. 2. List ’em all- After selecting the appropriate type and categories, make a list of all the brands and companies that fall under your desired categories. Post listing, the real homework starts. 3. Review the Business- Always research on the franchise that you want to buy. It is like studying a map, before leaving for unknown territories. 4. Evaluate the franchisor experience- Although, to be a franchise doesn’t take much experience, as the franchisor helps the franchisee, train. But, it is important to understand for the franchisee for what they are dealing with. An experience indeed counts. The older and more experienced the franchise is, higher the brand value it holds. This makes it easier for the franchisee to establish the franchise and function smoothly, as the franchisor holds sufficient experience to help the franchisee in times of distress. 5. Market Analysis- There could be no bigger blunder than buying a franchise without, analyzing or studying the market. Understand the product, study the demand for the product in the market and find an area where there is a higher demand for the products that you are selling. For example- someone who wants to buy a sports franchise should open their outlet close to the sports

7. stadium, schools or maybe near a physical training arena so that the sports gear or even the smallest sports accessory could be served to its demand. 6. Analyze the franchisor’s finance- Sometimes the franchisor’s lack of capital leads to unsuccessful franchise startup. Therefore, the franchisor is obligated to exhibit their financial statements to the Franchisor disclosure agreement. Before buying the franchise, ask an accountant to review franchisor’s accounts. Running Franchising Trends

8. Franchise Business 1. Multiple location ownership- Ask someone, what is better than one, and they will probably say two. When the franchisors, are looking forward to increasing the number of their branches, it is natural for the franchisees to wish and own multiple outlets of the same franchise brand. This can help the franchise to generate higher revenue and climb up the success ladder. 2. Digital Marketing- Since, the inception of the internet, another milestone that has caught the world off- guard, is the rise in the use of social media platforms, with its potential to connect any number of parties from anywhere around the world. Almost all of our friends and relatives use at least one or another form of the many social media platforms. It would be unwise, if anything, to not use these platforms as a means to market and promote the franchise. Other than social media, it would be wise to host the corporate websites by the franchises, but not without prior discussion with their franchisor. This could get you more eyes on your franchise, which would be next to impossible without digital or social media presence. 3. Online Business- It is one of the latest trends that have gained prominence, since this year’s beginning. The fast-paced life, nowadays, one hardly finds the time to buy products they need and sometimes desire, from the market. This is one reason, why franchises should work towards making their presence online. 4. Partnership- Although, a partnership is not a common practice in franchises, it divides the responsibilities, risk factors which help in the better and smooth functioning of the franchise.

9. Why Franchise? To set up a startup business one needs skills experience and finances. Here are a few points, how owning a franchise could be more effective and easier than a startup, for an aspiring franchisee- Franchise Business

10. •Solid Support System- Franchises provide independence of small business ownership, and the franchisee enjoys the benefits of a big business network, which in case of a startup business, is a slow process. •Lack of Experience is NOT a Problem- The franchisors provide the franchisee, necessary training to operate their business model, unlike, a startup which needs specialization, along with a tiresome planning process. • Higher success Rate- In a startup where every day is a fight to survive, franchises tend to have a higher success rate, as they are backed by the franchisor’s training and their business networks. •Cost Efficient- It is easier to secure finances for a franchise, as the startup capital required to start a franchise in most cases, costs comparatively less than a startup business. •Higher brand Value- Building brand value is what carries the brand to the major leagues. It is a slow process, which is very time consuming, to say the least. On the other hand, buying a franchise provides, the newly turns franchise owner, a piece of the brand’s existing brand value and goodwill, which provides a push to the franchise at the initial stage, which the business startups initially lack.

11. Are they really so good? Nothing is perfect – • Buying a franchise is a formal agreement, once it is signed there is no going back until the agreement expires or terminates. • Since most of the terms and conditions are drafted by the franchisor, it leaves little to no space for creativity or out of the box thinking. • Restrictions are everywhere from operations and product to the supplier’s franchisee may use. • The poor performance of other franchisees may affect your franchise’s reputation • Sometimes, the franchisors do not renew the agreement at the end of the