Consider the various methods of franchising before reaching a decision

Franchising in the UK has evolved tremendously in recent times. The successful nature of the franchising business method has further contributed to its popularity. The franchising business has propelled the increase in the economy a number of times. Franchising is now an integral part of the UK economy.

Franchising is basically an arrangement between two companies or a company and an individual in which the main company sells the rights to the other participant to sell its products and services.

However, the franchising business is not as easy it seems. This particular mode of franchising can be conducted in several ways. Some of the methods of conducting franchising are as follows:

Manufacturing and Business Franchises

The franchisor permits the franchisee to manufacture its products in the manufacturing method of franchising. The franchisee can also incorporate the parent company’s brand name and trademarks. This method is commonly used in the food and beverage industry. The franchising company receives an initial fee in this mode of franchising. The franchisee might also receive a stipulated amount for every produced unit.

The franchisee buys and distributes the products for the parent company in a business franchise. The main company or the franchisor provides the core client base for the franchisee to manage. Vending machines are a common example of a business franchise. The franchisee purchases the vending machines and obtains a part from the total revenue in this method.

Product Franchises

In this method, the franchisor uses the agreement to distribute its products to the end consumers. The franchisee in exchange can use the brand name of the parent company to sell its products. However, the franchisee will be required to pay a franchise fee in this particular arrangement.

Select a franchising method that best suits your preferences.