Showing posts with label franchising tips. Show all posts
Showing posts with label franchising tips. Show all posts

5 things every franchisee should remember

Posted by oink2 Friday, October 28, 2011 1 comments


After checking out the various brochures, select one franchise concept. Then communicate with the foreign franchisor and get more information. Pay particular attention to the basic terms and fees of the master franchise for the Philippines and the steps to pursuing the application process. The application process varies depending on the franchisor, but the following steps are basic:

1. The Qualification Form. Be honest and forthcoming when filling in this form. Franchisors do background checks.

2. A Visit to the Franchisor’s Head Office. You will have to meet the franchisor face to face to determine your compatibility. Most master franchises have a life span of 10 years or more. Can you work with the franchisor that long? During your visit, request a copy of the Unified Franchise Offering Circular from the US franchisors. These documents contain very important facts about the franchisor.

3. Memorandum of Understanding or Agreement. This document indicates a level of commitment to do business between you and the franchisor. The franchisor normally will indicate payment of a certain percentage of the license fee. If at this point you have even the slightest doubt about getting the franchise, don’t sign the MOU. Franchisors accept the reality that, sometimes, a franchisee needs time to come to a decision.

4. The Business Plan. In the business plan, you—the applicant—map out the strategies for developing the franchise in the Philippines. The franchisor usually provides the format. The business plan and market study should provide you with the initial indicators of the success and viability of the franchise concept.

5. The Master Franchise Agreement. The franchisor normally will give you enough time to review the Master Franchise Agreement. This document indicates the terms of your relationship in the coming years, and may not be amended except through mutual consent. Don’t be intimidated by the number of pages—usually 45 or more—but read through the agreement carefully, and then write down your comments. Get a lawyer familiar with international franchising to review the document. He should be able to translate legal jargon into layman’s language, and make sure the agreement complies with Philippines




source: entrepreneur.com.ph
Categories: , Read more »

Selecting the right franchise brand

Posted by oink2 Sunday, October 23, 2011 9 comments


Franchising is an option that a lot of people are considering as their ticket to entrepreneurship. Most people look at it as a way to get into business and learn the ropes of doing business.

To help you ease into the world of franchising, read the tips below compiled by Entrepreneur.com.ph on how you can land your dream franchise brand:

When you are shopping for a franchise brand, select two or three concepts to your liking. Then write a letter of intent to the franchisor. Be specific about wanting a master franchise and ask for brochures. Some franchisors will provide you with information on the license and other fees immediately, but others will give them to you later. Once you receive the documents, check out the following:

• Franchisor’s record in international franchising: A franchisor with long years in the business will want higher fees compared with those that are new in franchising.

• Number of company-owned and franchisee–owned businesses: A franchisor with more company–owned branches is more credible than one with more franchisee-owned stores.

• Features of the business concept: From the brochures, are you able to identify the franchisor’s uniqueness? Do they allow you to put a value on the concept and to identify the features that will let you position yourself effectively in the market?

After reading about the business concept, study whether there is a market for the concept in the Philippines. If there are companies already offering the same product or service in the country, is there a market segment you could still tap? How big is this market?

Ideally, the concept should be pioneering or first to satisfy a particular market need. But, as a result of the influx of foreign franchises, and the growth of homegrown ones, expect to have direct and indirect competitors. In any case, look for a market segment you could tap for the franchise concept.






source: entrepreneur.com.ph
Categories: , Read more »

The Advantages of Franchising

Posted by oink2 Sunday, October 16, 2011 4 comments

Franchising is a way to maximize profits in less time. Franchising is the growing trend in the Philippine business industry. Fast food chains, bakeshops, and even clothing lines are part of the rising franchise business popularity in the country.
Franchise business is another option for those who would like to convert and expand their small-scale business into a large-scale industry. Franchise system may be hard on the budget at first due to the franchise fee and the percentage of royalties the company gets but as the business continues, the entrepreneur would understand why franchising is more profitable and successful than establishing his own business. Here are some reasons why:
1. Mistakes will be avoided in the operation and management of the business because the franchisor’s formula is tested through years of experience.
2. The company the entrepreneur wants to join provides a detailed and hands-on training of managing, operating, and marketing your business. The idea in franchising (franchise fee) is buying the idea and management style of the large-scale company and using the tried and tested management in your own business venture.
You are likely to succeed in your business provided that the businessman takes small steps and huge amounts of time in learning the operation of the business.
3. Since you are under one roof, the incentive of advertising and development of the product is also the franchisee’s benefit. This is another support system in franchising. Less problems and hassle in promoting your business from the time you have acquired your franchise. The mother company will be the one to take care of it.
4. In franchising, the risk of losing big is lessened. Supplies and equipment to be used in the business is purchased at a lower cost since the company orders it in bulk to trusted suppliers and manufacturers. The franchising company can also negotiate better rates in terms of the materials needed for the sustenance of the franchise business branches.
5. The benefit does not only include the monetary gains but also extends to the reputation and trust it built to its customers. The customer will likely to purchase your product more than its counterparts since the customers already know what kinds of products are offered, the quality of the product, the service of the crewmen, and the instant recall it generates in the minds of the clients.
The clients are more likely to deal with a business they know and which expands rapidly rather that create transactions with the company they are not sure of and heard not even once.
6. If problems arise with the franchise, the company is there to assist and rescue from time to time. The assistance will always be available because the whole company would be affected if small problems will eventually lead to greater dilemmas.
7. Secured locations and defined territories are guaranteed in the franchising industry to lessen the competition of the same company and to enjoy maximum profits. This is another surefire way to dominate a specific location and optimize later on for expansion.
8. Trade secrets, ingredients, recipes, etc. are shared with the franchisees together with its established brand name. This ensures that every branch complies with the specific standards of the company.
These are only some of the advantages of franchising a business. Remember that the success of the business also depends of the entrepreneur because he is the one who will be working for the future success of his business venture.

source: magnegosyo.com
Categories: , Read more »

Buying a franchise? Look before you leap!

Posted by oink2 Saturday, September 3, 2011 1 comments
The statistics on the success rate of franchise businesses are encouraging, but Brendon Yu’s success story is not for everyone to tell. Before deciding, ask yourself the following:

1. What’s your personality?

“Understand that franchising… may not be for you,” John P. Hayes told a seminar on the A-Z of buying a franchise at the International Franchise Expo in Washington, DC, last April. In franchising, it’s the franchiser who creates, tests, and maintains the system and the franchisees follow it.  :If you’re not a follower, you’re not going to be a good franchisee”.

Before you decide to invest in a franchise, look at yourself and your personal needs. What do you want to do? Will your reasons for getting a franchise sustain your long-term interest in the business? “Do not put yourself in a situation where your needs will not be met,” Hayes said.

2. What is the future of this business?

“All franchises are not created equal, “Hayes said. “Some are better than others; your job is to seek out the better ones.”

Just because more than 90 percent of all franchise businesses survive does not mean every concept is going to make it. Look deeply into the specific opportunity that interests you. Don’t rely solely on broad franchising statistics. “What matters is the success and survival rate of the franchise concept you want, “ said Hayes.

Look at the potential of that franchise in your target market. Do people in your area use its product or service? How do they use it? If your market requires you to change the system for the concept to succeed there, forget the opportunity.

3. How do you like the franchiser?

Make it a point to meet the franchiser and see if you’re going to like the people you will be dealing with. According to Yu, the franchiser must be trustworthy and have time to listen and attend to his franchisees’ needs.

4. How many franchisees do you know?

Get to know as many as you can. “This is probably the most important step in the process,” said Hayes. Beware of franchisers who claim you don’t need to visit franchisees because you can just as easily observe how the business operates in the head office or a company-owned outlet.

Ask the franchisees you meet these questions: Can you trust the franchiser? Will you buy the same franchise again? How helpful is the operations manual? Is the training good? How much money can you really make? Are the fees the franchiser collects justifiable?



5. Are you up to crunching numbers?

The franchise fee is an upfront payment that will give you access to the franchiser’s system. It will also grant you the use of his brands.

The royalty fee, which is a percentage of gross sales, is remitted to the franchiser who uses it to finance ce his operations and profits from it. When a franchiser says he will not collect royalty, ask him how he will make a profit and provide the support that his franchisees will need.

The advertising fee—usually one to three percent of gross sales—is collected to build a fund for the system’s advertising and marketing programs. The reason behind it is that it will be more expensive for the branches to launch an advertising campaign if they were to do it individually.

Aside from the franchise fee, royalty and advertising fees, there are other costs you will incur when you buy a franchise. You may have to lease space and improve it. You may also have to invest in furniture and fixtures, supplies and training. Plan for how you’re going to survive until the business makes money.

6. Can you write a business plan?

Some franchisers will require you to do your own market study and to create your own business plan. Even if they don’t ask for it, do it just the same—it will help you navigate your course once you go ahead and get a franchise. After all, it’s your time and money that you will be investing.
Categories: , Read more »
Related Posts Plugin for WordPress, Blogger...

Copyright-2011 © Jump to Business. All rights reserved.

Tricks-Collections Themes created by Tricks-Collections.Com