?What is Franchise mean? How does it work
Simply put, franchising is a way for a business to expand beyond its original owners. The most common form of franchising is a business format franchise, where the franchisor contributes certain elements of the business and the franchisee contributes certain elements. The power of franchising is realized through the combination of the contributions from the two participants. Franchisees pay initial franchise fees and then ongoing royalties for access to the format the franchisor has developed and for ongoing enhancements to the system.
The franchisee contribution involves the management skills to run the business day-to-day using the franchisor-provided brand and system, and capital to fund the opening and continued operations of the business. In addition, the franchisee brings a level of desire and interest in having the business succeed that is essential to franchising – and is something the franchisor can’t replicate on its own.
The franchisor contribution involves trademark and methods of doing business, which will brief your way to success.
The below schedule is the basic different between starting your own business and franchise business.
Self-owned Business V/S Franchise Business