Franchising : A Business Within An Established Business
December 27th 2006 05:23
Owning a business is a dream to many of us. There are ways to make this dream come true. We can put up our own business and manage it the way we know best, we can buy an existing business and operate it outright, or we can buy a franchise. If we choose franchising, it is important that we do our homework and validation before going on.
Franchising is technically defined as a method of doing business by which one person, the franchisor, grants another person, the franchisee, for a specified period of time, the right to advertise and sell good and services which are identified with the franchisor's trademarks, using the franchisor's know-how and business system.
Franchising as business method varies, but generally fall into two categories. The first type is the product or trademark franchise, in which the franchisee is granted the right to use the franchisor's trademark and to distribute it's products. The second type is the business formal franchise which involves the right to use the trademark and adopt the entire system of doing business by franchisor. The emphasis is on training to run a franchise under the proven operating system. Franchisor renders support and assistance from site inspection, store construction, preoperating preparations up to the opening and actual operation of the business which includes training and consultancy. Thus the usual trial and error learning process of a start-up business that usually brings a necessary expenses and financial losses that may eventually lead to business failure and bankrupcy are avoided in franchising.
In franchising,you can be in a business for yourself but never yourself, the franchisor is always there to help. Franchising offers you not only the chance to have a business of your own, but also for the chance to be so within an established system.
Franchising is technically defined as a method of doing business by which one person, the franchisor, grants another person, the franchisee, for a specified period of time, the right to advertise and sell good and services which are identified with the franchisor's trademarks, using the franchisor's know-how and business system.
Franchising as business method varies, but generally fall into two categories. The first type is the product or trademark franchise, in which the franchisee is granted the right to use the franchisor's trademark and to distribute it's products. The second type is the business formal franchise which involves the right to use the trademark and adopt the entire system of doing business by franchisor. The emphasis is on training to run a franchise under the proven operating system. Franchisor renders support and assistance from site inspection, store construction, preoperating preparations up to the opening and actual operation of the business which includes training and consultancy. Thus the usual trial and error learning process of a start-up business that usually brings a necessary expenses and financial losses that may eventually lead to business failure and bankrupcy are avoided in franchising.
In franchising,you can be in a business for yourself but never yourself, the franchisor is always there to help. Franchising offers you not only the chance to have a business of your own, but also for the chance to be so within an established system.
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