The Advantages of Franchising
Sunday, October 16, 2011
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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
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4 comments:
Franchising is one of the well-known business development techniques on the globe today. It helps in getting some fast achievements, without having much business information. The information you have shared about it might be helpful to people because franchising can be a amazing way to flourish your business.
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Franchise business has a good advantage. One of the best advantage that you get when you franchise your business is the point that the business develops without you placing too much money into it.
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