The Art of Mastering Services

A Good Explanation of Franchising Franchising is simply put as giving of rights to operate in the same products as the mother company to another business in another geographical location, away from the original business. The franchise could be simply compared to leasing or renting for an opportunity. Now from the whole concept of franchising, we get the franchisor and the franchisee; where the franchisor is the mother company that gives the right of operation to the franchise. The franchisee is required to pay to the franchisor some money to be allowed to operate. There are financial commitments that the franchisee must fulfill to be given the green light to operate. The payments that the franchise is supposed to pay the franchisor include the trademark’s royalty, the cost of training and advice services, and a percentage of each unit sold. The success of the franchisor depends on the success of the franchise. The franchise only last for a particular period. Every time the franchise agreement expires it could be renewed. Every single franchise is supposed to operate at the agreed location. The franchisor protects the trademark while the franchise is charged with the obligation of carrying out the services which the trademark entails.
Overwhelmed by the Complexity of Businesses? This May Help
The single franchise and multi-franchise are the two major types of franchises. The difference between a single franchise and a multi-franchise is that a single franchise only operates one unit while a multi-franchise operates more than one unit.
The Key Elements of Great Businesses
The franchisor and the multi-franchisee agree on what number of units to open and in what period and in a specific geographical region. A unique agreement for each unit of the franchise is set. Multi-franchises are in high number nowadays due to their popularity. Over the many years that the multi-franchises have been in existence they have gained popularity. To set up multi-franchises high levels of investments are required. Multi-franchises have high levels of stability which is their major advantage. Since the multi-franchises operate in diverse locations their level of success is very high. One single franchise may not be as successful as multi-franchise. One location that a single franchise operates from might disadvantage it. The reason why multi-franchises have enjoyed exponential growth is that of popularity growth. When the franchisors realizes there is huge potential in multi-franchises they encourage the multi-franchises to open more and more units than before. If it happens that one unit of the franchise fails the other franchise units may come into the equation and help it to rise to glory. It is advisable for anyone who wants to carry out multi-franchising business to carry out a good research to establish if the area they want to set up these businesses is viable for business. Having ready cash is a prerequisite for the multi-franchise to thrive.