How franchising is beneficial
In the UK, the franchise industry is playing an active role in economic growth. Opportunities exist among organisations with proper business plans, management trading and marketable products. Before investing, you need to know the risks associated with the franchise to help you run a successful business.
Functions of the business owner or franchisee
In a franchise, the franchisee runs the business and sells products and services under rules set by the franchisor. The franchisor is owns the organisation behind the products and services. The franchisor can have multiple franchisees in different locations which will be selling the same product or service.
Benefits of purchasing a franchise
Purchasing a franchise is one of the easiest ways to start a successful business. In most of the cases, brand recognition is already in place, which means you only have to wait for the customers and sell them the products. You will also benefit from administrative training, financial assistance, marketing plans and managing guidance. The majority of franchisors have a business format which will help you ply your trade.
Types of franchise business
Franchise business falls into three main categories, with business format franchise the most common. It provides training to the franchisee regarding products or services. The second type most common franchising category is trade or product name franchising, wherein the franchisor sells the trade name to the franchisee. Another type of franchising is a distributorship. Here, the parent company gives the right to sell their products. It is important to determine the type of business in which to invest.
Before opting for any type of franchise business, consider the skills and expertise you already possess. This will give you some of the preparation needed to reap great profits out of the business.