Franchising
.... (2) Product Franchising: here you buy rights to resell specific products that are sold through an exclusive and restricted distribution network under the manufactures name such as gasoline, oil distributors etc. (3) Turn Key Franchise: here the franchiser supplies a complete business format encompassing every aspect of the business from the product to a complete operating system including plant equipment, marketing, accounting and all other necessary services which are important while operating a specific type of business. Every aspect of these three categories has been pre-planned, all one has to is apply the requirements and the franchise is under way. TYPES OF FRANCHISES: The types of franchises that you might consider are listed below: 1- Typical Franchise types: • Single unit • Multiple units • Area Development 2- Not so typical Franchise types: • Sub-Franchiser • Fractional Franchiser • International The selection of the franchise type will have a very significant impact on the franchise business plan. FRANCHISING AS A MEANS OF BUSINESS EXPANSION: The benefits of franchising as a means of expanding a business are two fold. (1) It involves low capital investment by the franchiser as the capital used to expand the network which comes from the franchisee. (2) By franchising the business, the franchiser places the expansion of his business in the hands of the people who are motivated to make it work. By using the franchisee's capital, the franchiser is able to establish a large number of outlets in the short period of time. Rapid expansion can be achieved without incurring the overheads and costs associated with operating company-owned outlets. This brings benefits to both, the franchiser and franchisee as it helps build consumer recognition quickly and establish the franchise. The cost of expansion for the franchiser is usually limited to the cost of franchisees recruitment, training and assistance prior to ...