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| Franchise Business |
Franchise Business, Franchise Advantages
McDonald's Franchise Cost and Terms
Choose the best franchise system and get started.
How does it work?
1 Definition of franchise
2. Advantages
3. Factors for franchise success
4. Financing and expenses
5. Earning opportunities
6. Business plan
7. Profit
8. Result
Starting a franchise busines
Along with success the franchise economy is constantly growing and there is no end to the trend. There are approximately 1000 franchise systems in various industries operating in Germany alone, from which you can choose.
Is it better for you to start a franchise? Because you can get all the information you need to know about this increasingly popular form of self-employment here.
What is a franchise system?
Behind the term franchise or franchising is a system of distribution that relies on the division of labor: while the head office, the franchisor, is responsible for the further development of the business concept, the franchisees implement it in direct contact with customers. ۔
Everyone involved appears to be independent businesses operating on their own account and in their own name. However they all belong to the same brand. They are bound by a franchise agreement, which clearly defines their respective duties and rights.
Franchise in Germany: system and current statistics
The franchise market in Germany has begun to move. For a long time it was dominated by well-known brands in system catering, but recently more and more new companies have been added, some of which are very successful even in small niches. The latest industry figures are for 2020 and 2021. According to him, there were 139,000 franchise partners in 930 franchise systems in Germany with 176,000 franchise businesses.
All of this contributes to a sustainable growth trend. Total turnover is growing year by year and the German Franchise Association estimates 135 billion euros for 2021.
It is noteworthy that the majority of franchisees were not self-employed before. Obviously, this particular form of business start-up is a good solution for many people to start a business and start their own business without their own business idea.
How does it work, what does the Franchise system do?
The head office develops the business concept and standardizes the work processes, which are then applied to individual franchise companies. She runs advertising campaigns, conducts training courses and checks on-site to see if standards are really being met.
Franchisees "borrow" the business concept from it and pay a fee for it. You benefit from brand awareness and headquarters knowledge, but your business freedom is limited. Your job is to implement the concept one-on-one at your location. This is to ensure a uniform appearance and uniform quality.
This is important because the success of franchise systems is largely based on the fact that customers always know what to expect - no matter which company they visit in the system.
Establishing a franchise company
If you decide to start a franchise business, the biggest benefit for you is that you are implementing a tried and tested business idea. So obviously there is a market for the product or service you are offering. You can benefit from the experience of other franchise partners and you don't have to make every mistake yourself. You almost know what expenses you will have to pay and which income is realistic. You have access to a clear structure and you are free from many strategic tasks. Advertising campaigns are conceived at headquarters and then implemented nationwide - increasing their effectiveness. In general, it's easier to join a well-known brand than to start from scratch. Identity value is high and with this brand you can generate good sales thanks to consumer identity.
A well-known franchise system will help you in many ways to start and run your own business.
Franchise Advantages
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| Business Advantages |
There are several benefits to being part of a well-known company's franchise system. Let us know those benefits.
1. Business support
The franchise company supports your business and further it depends on the terms of the agreement and the nature of the business. You are provided with the brand, equipment, better strategy and advertising plan ie you are given the complete guidance you need to run the business.
2. Brand recognition
The biggest benefit you get after being part of a popular franchise system is brand recognition in the market. If you start a business, it takes a long time to get to know you and your brand. When you buy a franchise, you get a brand identity in the market and so you don't have to look for your customer. Because you have become part of a well-known brand franchise where the customer already knows better about your brand.
3. Low failure rate
It has been observed that the failure rate of franchises is much lower than that of solo business. You take a franchise and join a famous and market value brand as well as a network that offers you support and advice.
4. Profit
It has been observed that you can make more profit in franchises than in doing independent business. This is because a large number of franchisees have well-known and well-known brands in the market and thus you get a large number of customers and as a result you can get good profits.
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