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Franchising

The fastest growing
business model in the world

Franchising: a rapidly growing business model

Whenever the word "franchise" is mentioned, most people think of restaurant chains such as McDonald's, Burger King and Kentucky Fried Chicken, or shop chains like SevenEleven.
The basic franchise concept is to let independent businesspersons make use of a specific business concept within a local geographic area.

The typical framework of this arrangement is usually so fixed that the independent franchisee is perceived as part of the international chain. People eat at McDonald’s, not at an establishment run by a local franchisee.

The franchise concept originated in the US, from where it has spread to the rest of the world. This combination of an established business concept and a large number of independent businesspersons developing their own businesses as entrepreneurs is now the fastest growing business model in the world.

	Entrepreneurs, who can hardly wait to establish their own business and to whom a ready-made business concept is a perfect shortcut to independence.
	Successful managers in companies, who wish try their hand at running an independent business, but lack a good idea for their own business.

Franchisees buy into a new or an established business. A natural part of any franchise agreement is the right to resell the business whenever this becomes relevant. Become a franchisee

Franchisors

Establishing a company is a stimulating yet demanding task. Most companies remain small and local. But some company owners are deeply motivated by an urge to found a large-scale and perhaps international business. 

As opposed to the franchisee, the person who founds a business is often an entrepreneur capable of seeing the potential of a specific product or business. The franchisee may be capable of founding a successful business, but may lack the ability to establish a large organization as well.

Franchising should be seen as a tool – a business model – that gives the entrepreneur an opportunity to proliferate his/her idea in cooperation with local independent businesspersons with a knack for running the local business.

Master franchisees

When developing large, international franchise companies, it is often expedient to insert an extra organisational link between franchisor and franchisee. A master franchisee can be given the responsibility of building up the franchise enterprise in a large market area, such as France or Scandinavia. 

The master franchisee is typically a franchisee himself/herself running one or more businesses within his/her market areas.

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