How does a franchise work?
A lot of people research franchise opportunities later on in life. They may be finding that their current career simply isn’t rewarding enough or that it is not making the most of their skills. Other people consider franchise opportunities when they have been made redundant and want to try something new.
But the first step to becoming a successful franchisee is understanding exactly what you are taking on. Put simply, a franchise is an agreement between two parties. It gives the franchisee the rights to market a product or service using the franchisor’s trademark and reputation.
The franchisee is able to use the business methods of the franchisor and this makes it much more secure than starting your own business as these methods have already been proven to be successful and the reputation of the company will already be secure.
In exchange for all of this, the franchisee must agree to pay fees and royalties to the franchisor.
This method works really well as both the franchisee and franchisor have a vested interest in ensuring that the brand is a success. For this reason, franchise opportunities are a great option for most people as the risks are far fewer than those associated with starting a business from scratch.