INTRODUCTION
In todays world setting a business is a difficult for the new entrepreneurship , as they are new they have to first make a good relation in market like have to make relation with wholesaler , retailer , even with customer its take a long time to develop a good will in a market and for this they need some extra money to be still in a market even if they are not earing a great amount of profit. So, to start a business its better to take a franchising rather then setting your own business because its just need a money and place as their name and good will is already know in market. SO, here the question comes what is franchising , the franchising basically means when a owner of the company or organization allow the other parties to use their trademark or trade name for providing the service or the product , here the person who allow the other parties or individual to use their organization name or trademark get some royalty, or may be some kind of amount in return by allowing other parties using their trademark or company name. The relation between the owner of company whom we call the franchisor and the person who get a franchise whom we called a franchisee is that franchisor provide knowledge who to operate the business, the franchisee basically get a advice from the franchiser about who operate the market, how to maintain the standard of band, how to get a profit in a competitive market .
HISTORY OF FRANCHISE
Franchise is many time taken by the new entrepreneurship but is also many time done by the company also to increased its marked share or expand its business geographically so they give their business name to the individual or to the organization to start a business under their brand name or trademark, but the question is how this franchising a business started, So the history behind is during the middle age the govt. which were local they grant a church official or any other some famous person to charge a taxes and see the civil order and try to maintain that civil order . Medieval court allow the locals to have a transportation for the custom, setup a market or they can practice their professional activities . For this they need a license and in this exchange they paid a royalty . all this monopoly become a part of a European law .
During the colonies period this franchise is introduce to the business men who agree to colonized and a protection from the crown and in exchange they will give the taxes or the royalty.
The first franchise in Australia was given by governor Macquarie under ‘ROYAL PRIVILEGE’, in 1809. Here the franchisee has a right to import 45000 rum for over 3 years and in exchange they will build a Sydney Hospital.
And this is how the franchise started and in many studies and research told that the franchise now a days in a min like every five min there is opening of 5 to 8 franchise in a society .
FAMOUSE FRANCHISE IN TODAYS WORLD
There are many business who gave franchise of their business to other individual or organization these are some famous franchise 1. SUBWAY this food brand you will see in every state or even in every country this food business having a 42000 location around the world. And the fee or the franchise Of SUBWAY is $15000, 2. DOMINO’S this food brand is basically is famous for it different taste of pizza this was one of the most loved brand in world of pizza it’s franchise fee is around $ 25000, 3. KFC is this most famous around people who are non-veg it royalty fee 5% 4. BURGER KING as per its name it was famous for the variety of burger and its royalty is 4.5 .And there are many more franchise which were famous and profitable in nature.
WHAT IS FRANCHISE BUSINESS MODEL
As it already somehow explained in introduction what is franchise here we understand in a more clear way what we called a franchise model , So basically when any individual or an organization use other person brand name, trademark or their business model in exchange of royalty or some kind of fee this process we called a franchise , here the person who give there brand name or trademark is called franchiser and who take the franchise is being called franchisee . This business or franchise model chose by those who basically don’t want to start its own business . And the franchise business model is basically based on the contractual basic here they get into a contract and according to the contract they work and in this contract they also decide for many year this franchise will be work and when it will come to end.
ADVANTAGES OF FRANCHISE
- As the business men or new entrepreneurship get a franchise or already established company so they don’t have to do more advertisement about the brand name
- Here the risk is low as the name is know by the customer and they already using to or know about it so its easy to get a profit
- Get a free advise from the franchiser about how to manage or operate a business.
- The another advantages of franchise is that you will get the quality supplier and dealer
DISADVANTAGES OF FRANCISE
1, As you are operating someone other business you have to manage business or regulate a business according to them
2. There are lack of financial privacy this the franchisee have to show their financial sheet to the franchisor .
3. They may be costly for the small business men because it may include lots of royalty fee , starting a new business is also a costly thing it include rent fee employee salary and many more.
HOW DOES FRANCHISE PROCESS WORK
So if you want to take a franchise regarding any business you first check its background how its work what are their policies , the response of the customer regarding that brand its royalty fee or its fees after all this when you are know everything about the business get ready to meet up with the Franchisor and after this try to offer for the franchise when they ready to give their name or trademark with some royalty fee then after this try too negotiate so you can get a discount and after all this make a contract paper.
CONCLUSION
To sum up this article the franchise is same as other business but having some different business model . It’s having their own advantage and some disadvantage too. Its was the best business for the new comer in the market, it give them less risky business and also a huge customer basic as they already know the brand name .The franchise having their own history and it is also a very old business operated by the people.
