Reducing the risks of new business thanks to a tried-and-tested model of success tempts us to use the franchise model. With a relatively small investment, you can open a franchise with greater chances of success and high profitability. you want to to know everything about franchises?
Care before hiring a franchise
A company’s chances of success increase significantly if you opt for a franchise system. In addition to the support from a known brandthe system offers permanent assistance.
Assistance will be provided to the franchisee in selecting the point of sale, setting up the facilities, hiring the team, institutional promotion, obtaining bank financing and obtaining market intelligence and utilizing the expertise of the brand, developed over the years.
But you have to take something Care by investing in a franchise system. “You have to study the premises, the brand, without forgetting the franchisor’s figures. Investment capital, working capital, return and the region,” advises Expande Franquicias Fabrícia Vidaurre’s advisor and founding partner.
Glossary of everything related to franchises
Below is a list of terms including All about franchises:
- Franchisor: Person or entity that owns the brand, business model and technology.
- Franchisee: Any person or entity that purchases a franchise and has the right to use it business model of the franchisor. He is responsible for the implementation, operation and management of the franchise.
- Franchise Fee: It is the first payment upon signing the contract to purchase the franchise. It can also be a monthly fee for advising the company.
- Advertising fee: It is a monthly or periodic fee that is paid to share in the costs marketing campaigns of the network.
- Royalty share: Fee paid by the franchisee for the right to use the trademark or marketing your products. This value varies depending on the contract type: for example, it can be a percentage of the unit’s billing or the purchases made.
- Area: It is the area in which the franchisee can work during the term of the franchise agreement.
- Franchise Unit: Represents the physical location where the franchisee conducts activities.
- Initial investment: Value you must have in hand to start the business. Try to know what is included in the payment of that value. reform off the premises? Share? Gear? Also, be prepared for expenses not included in this investment: rent, license fees, and staff are just a few.
- Annual net sales of the network: Shows the profit from all trades in the network. That shows the franchise size and can be important in deciding whether or not to invest.
- Average monthly net sales: Estimated value in the performance of the units already in service.