Franchising is a way to run your company under a well-known brand, which will allow you to break into the market faster and reduce the risk of business failure. So it is a way to apply a proven business model of a company with experience, knowledge and brand in that industry in your personal business and thus increase your profit.
So, you invest your money and have freedom in terms of running your own company, and in business you use the brand, experience, knowledge and methods developed by the franchisor (for example: McDonald’s, Burger King, numerous domestic retail chains, …)
Mutual rights and obligations are regulated by the contract.
The basic obligation of the franchisor is to assign the right to do business under his brand, as well as to transfer his knowledge to you for the entire duration of the contract (from training in business management, employee training, support in procurement, supply and sales, through finance and accounting , all the way to the transfer of marketing and promotional knowledge).
Your basic obligation as a franchisee is to respect the transferred rules of conduct and to pay franchise fees, usually in addition to the entrance fee, you also pay a regular periodic franchise fee, which can be fixed or a percentage of income.
Franchising is a proven business model, which is successfully used by hundreds of thousands of entrepreneurs in various industries around the world. The number of franchise business units in the world is constantly growing, even in countries whose economies have a negative trend.
All those who do not like and do not want any business rules imposed on them, all those who have more courage and enough financial resources for business experiments and easier submission of business failure, are certainly not the “first customers” for any of the franchises.
Conclusion: It is incomparably easier, safer and more certain to develop an entrepreneurial spirit under the umbrella of an already proven business system, because experience and knowledge are the key to success, and success is what counts.
