Understanding the Franchise Business
In expanding your market one of the best way by which to do this is through franchising. You will notice that fast food restaurants blossom like mushroom because of this method and way of doing business. When a company is engage in this form of expansion they will need willing investors to buy their business model and brand with agreements attached to it. These agreements together with the company rules and regulations must be meet by the franchisee. You must understand that in a franchise you as the franchisee is the proprietor of the business. The problem is everything is still under the supervision of the mother company. There are three types of franchises that you must be familiar about: a) Distributoship. This will require for you to sign an agreement with the mother company to sell their products or services. Usually this will involve exclusivity in their line of products. b) Trademark and brand name licensing. You as the licensee will be provided with the right to use a company’s trademark or brand. This will be allowed in conjunction with the operation of their own business. One of the most familiar company that everyone is probably acquainted with that is involve in this is Coca-Cola. c) Business format. If you are familiar with Mc Donalds, Subway, and KFC. Then they are very good examples of businesses which are involve in this. The license or right to sell its goods or services, use its brand name, business model, techniques and others. It is like having an exact replica of its business.
