By Gopal Singh
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ď‚ž An
arrangement whereby someone with a good idea for a business (franchisor) sells the rights to use the business name and sell a product or service (franchise) to others (franchisees) in a given territory
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Franchisor is a person or company that grants the license to a third party for the conducting of a business under their marks
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Franchisee is the party in a franchising agreement that is purchasing the right to use a business's trademarks, associated brands and other proprietary knowledge in order to open a branch.
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The ability to expand using franchisees capital Franchisees are typically more motivated to succeed than managers Franchising promotes increased quality at the unit level Franchising enables a company to grow faster than it otherwise would through corporate expansion Reduced risk and liability for the franchisor Fewer concerns over day-to-day operations
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* Investment Franchise:
Investment franchises are operated by the fast-food and restaurant chains, as well as by some well-known hotels. The franchisee has overall control of the business Employs his or her own senior management and staff
* Executive Franchise: Involves the provision of professional services, Financial advice, legal services or recruitment assistance.
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*Â Retail Franchise: ď‚ž
The franchisee runs the outlet, employs staff and displays goods approved by the franchisor.
* Distribution Franchise: ď‚ž A distribution franchise permits the franchisee to operate from a depot or central office that is usually owned by the franchisor
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* Depot Franchise:
The franchisee is the operator and sole occupant of the depot This type of franchise is generally available to courier companies and parts suppliers, for whom a depot is an essential part of the business. Job Franchise: Usually a one-person business, operated by the franchisee from home Home-delivery operations, such as lawn care, car repairs or furniture refurbishing, are examples of job franchises www.franchisezing.com | +91-9717899733
* Management Franchise: ď‚ž
A management franchise is where the franchisee will be responsible for both running the franchise and employing and managing a team of operatives
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Franchising has a Huge Growth ahead in India Relatively New Concept for India Around 1,200 Franchisors in the country (200 are foreign) More than 100,000 franchisees Current market size in India: $10 billion $25 billion by 2014 (30 % Growth Rate) 3% of the total Retail Sales 12 % of retail sale revenues are from franchising 800+ Malls, 2500+ Supermarkets
Franchising infrastructure is in place in India
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Franchising Reduces Business Risks 90% of start-ups fail in the first year. In a franchised business, over 90% succeed. Proven business model, recognized brand, customer acceptance Established methods and quality Pre-opening (site selection, financing etc) and operational assistance: staff, training, advertising Wider market penetration Relatively low capital investment Ready Product Acceptance Quick Start
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The franchisor gets easier access to capital for rapid growth The franchisor leverages the franchisee’s knowledge of the domestic market & regulations Franchisees are far more motivated to maximize sales and profits than salaried branch managers. Franchisees are an important source of new marketing and product concepts
www.franchisezing.com | +91-9717899733
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