Opting franchise route for the expansion of the brand is a popular trend these days. Franchising helps in creating an image for the brand and making it a big success. It also helps thousands of aspiring entrepreneurs to be their own boss. It allows small entrepreneurs to be in business for them but not by themselves. An entrepreneur invests in a proven business formula and trades the products and business services which have already been established. Some examples of today's popular franchises nationally as well as internationally may include McDonald’s, KFC’s, Domino’s Pizza, adidas, Puma, NIIT, Aptech, Eurokids, raymonds, Subway and many more.
The most successful franchise industries in India may include Food and beverages, health and fitness, education and training, business services, pre-school education, beauty and spa, retail franchising and so on. In fact today there is hardly any business that can not be franchised.
What is a franchise?
A franchise is a successful business owned by an entrepreneur that has been developed over the years and has created a brand value for itself. After opting for franchise route for expansion the business owner becomes a franchisor. Aspiring entrepreneur when takes a franchise of his business by putting up an investment of his assets the franchising process begins.
Thus franchising is a business relationship or a joint commitment between groups of entrepreneurs who shares common responsibilities and relation to achieve a specific goal. However, franchisees are bound to using the prescribed marketing and operating systems of the franchisor.
In short, it is interdependent business network that allows a number of individuals to share:
A successful business plan An established brand name A common marketing and distribution system Common goal Partial Support from franchisor Responsibility for quality and customer satisfaction
Benefits of franchising: The benefits of franchising are manifold.
Starting a new business demands a lot of planning and trial. But a franchise business saves franchisees for doing any mistake. He follows a franchisor ideas and business plan, which has already successful.
Franchising provides a detailed manual for the right supplier for materials, finding the market for best ingredients, or the best price on shipping and lodging the material.
Most of franchisors offer training and assistance to their franchisees. They also provide help in finding the best location for new business after searching the market.
The franchisor will also support the business operation by providing key equipments, such as infrastructure, and IT systems.
Franchising helps to get discounted deals on supplies and services because as part of a big company, franchisees have access to bulk-rate discounts that advantage is unavailable to sovereign business owners.
It limits the competition because franchisee operates the business under an exclusive geographical area. It means the other franchisees are not in competition directly.
Associating with a successful franchise company automatically reduces the risk. It does not mean that it is a hundred per cent success guarantee program in fact it reduces the chances of failure as franchisor is there to handhold. So if you are thinking about investing into a franchise system, it is important that you understand exactly how franchising works.
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