How to Make Franchising Profitable for All Parties
Franchising is a business model where the franchisor (the owner of the brand) is selling exclusive rights to a franchisee to run a business under that name on a certain territory. To give you an example, the fast-food conglomerate McDonald’s doesn’t own a single restaurant directly. They’re just selling a franchise to a local interested party. Here you can see how to make franchising profitable for all parties.
In this example, it’s clear that a franchise can be incredibly profitable. Still, does this mean that all the franchises make it? Of course not! The task of being successful is made even more difficult by the requirement for a franchise to be profitable both for the franchisor and the franchisee. How does one make all of this work? Here are a few tips and pointers to help you out...