Franchise

DEFINITION

A FRANCHISE is any arrangement in which the owner (franchisor) of a trademark or trade name has licensed others (franchisee) to use it in selling goods or services.

A FRANCHISEE is any individual or group of people who purchases a franchise.

A FRANCHISOR is the individual or corporation that is selling the franchise.

Franchising is a “continuing relationship in which the franchisor provides a licensed privilege (i.e. right) to do business, plus assistance in organizing training, merchandising and management in return for a consideration (i.e. fee) from the franchisee”(Harper Graham).

ADVANTAGES OF FRANCHISING

There are various benefits of franchising which make it better than starting up a new venture or buying an existing business. Some of which include:

Training and guidance

In a franchise agreement, usually, the franchisor provides training and guides the franchisee on the best practises of running the business.

Brand-name appeal

People mostly like to buy brands that have been used before or well known to them so; buying a big name will make the franchisee have more chances of success.

A proven track record

A franchisee can see all record of the company from the franchisor based on the location, price and quality of goods or service, and financial records and evaluate the chances of success. This will prove the viability of the venture.

Financial assistance

A franchisor may help the franchisee acquire loan or may even personally lend the franchisee money to start the business in cases of limited capital. 

Examples of Franchise

One example of Nigerian franchises is the Chicken republic by Deji Akinyanju which provides fast food services and International franchise is Mosquito Joe is a franchise that provides outdoor mosquito control in the US throughout the mosquito season.

Other Examples of Franchises are listed below:

1. 7-Eleven Inc.

2. Subway

3. Dunkin’ Donuts

4. Pizza Hut

5. McDonald’s

6. Sonic Drive-In Restaurants

7. KFC Corp

 8. InterContinental Hotels

9. Domino’s Pizza LLC

10. RE/MAX

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