Are You Thinking About Franchising
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Released 8 July 2008
Some key considerations
Franchising is a very good method of growth for some businesses. Some of the
key benefits for the franchisor’s include:
increased service channels for the franchisor providing quick market
chance to maximise existing networks
a reduction in the risk of failure
control of all businesses through a franchise agreement
the granting of a licence to a given franchisee for a fee over a fixed term
an identical business format following your perfected practices/ procedures
the opportunity to make money from providing support and marketing services
To set up a franchise, the franchisor has to put in some hard work in
documenting his practices/ procedures.
First and foremost the franchisor must have a pilot operation up and running.
He must have manuals, programs for marketing, training, monitoring and control
procedures and dealing with the finances of the business. Above all the business
model produced must be attractive to others in order for it to be successful.
In return for offering a franchise the franchisor will usually seek a royalty
payment, i.e. a fee based as a percentage of the franchisee’s turnover or margin
on product/ service in addition to an initial franchisee fee (outlay fee) for
the costs incurred in setting up the franchisee in business.
The franchisee will benefit form the power of the brand of the franchisor,
the wealth of experience that the franchisor has in the product/ service and the
support that the franchisor can provide in what one would assume is a proven
product/ service, the marketing of the product/ service on a wider scale,
product/ service development etc.
is a commerical lawyer who specialises in information technology law and
intellectual property law with an emphasis on IT, escrow and buying and selling
About the Author
Lawdit Solicitors offer services and
advice for litigation, commercial contracts, Intellectual Property and IT legal
agreements. We are experts in commercial law with a heavy emphasis on
Intellectual Property, Internet and e-commerce law. Lawdit is a member of the
International Trademark Association, the Solicitors' Association of Higher Court
Advocates and we are the appointed Solicitors to the largest webdesign
association in the world, the United Kingdom Website Designers Association.
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Article Published/Sorted/Amended on Scopulus 2008-07-13 15:04:18 in Legal Articles