Types of Franchise business (Part 1)
You might have heard of the franchise system and probably it is not something new for you. You might have also heard about clothing and food establishments that have been franchised. People who do not have any idea about the franchise business, a franchise is a permission that is provided by the manufacturer or the owner to retailers or distributors to sell the manufacturers' or owners' products and or services.
For example: There is a Restaurant X who specializes in fried chicken. It is very popular in a particular country. Now, it wants to expand itself by providing franchising opportunities to individuals or smaller companies who are looking for a business to start. So if individual Y wants to have a restaurant that will serve chicken, he or she may get a franchise of Restaurant X. If the restaurant gives permission, Individual Y can open a Restaurant X of his or her own, using the brand, under the terms provided by the franchisor. To help the Individual Y to start the business, Restaurant X will provide training, guidance and support.
Now you know what franchise means. There are also different types of franchise businesses. There are four types of business namely:
- The Manufacturing Franchise - A Business Format franchise - The Product Franchise - The Business Franchise Venture