Buying A Franchise Pros And Cons

Buying A Franchise Pros And Cons – Understand the pros and cons of franchising. Explain franchise options and industry structure. Describe the process of evaluating a franchise opportunity. List four reasons for buying an existing business and describe the process of evaluating a business. Copyright © 2006 Thomson Business & Professional Publishing. All rights reserved.

A business system that revolves around an agreement between two parties, in which the franchisee does business according to the terms defined by the Franchise. party to the franchise agreement specifying how to become. followed and the conditions to be met by other parties Copyright © 2006 Thomson Business & Professional Publishing. All rights reserved.

Potential Benefits Proven Business Rank Affiliate Pre-qualification Training Franchisor Financial Assistance Franchisor Assistance Employment Benefits Franchisor Responsibilities Franchisor Cost Limits Initial Fees Investment Costs Credit Advertising costs Marketing restrictions Limits on independence Lack of franchisor support Copyright © 2006 Thomson Business & Professional Publishing. All rights reserved.

Pros And Cons Of Franchises: What Every Entrepreneur Should Consider

Marketing area restrictions Apply for website approval and place conditions on shop appearances Limit the goods/services that can be sold Request special opening hours Advertising control Copyright © 2006 Thomson Business & Professional Publishing. All rights reserved.

Note: This is only an estimate of the capital required to open and operate your salon for the first 12 months after opening the business. Great Clips cannot guarantee that you will not incur additional costs in establishing the Company. Attachment 4.2 Source: April 27, 2004. Copyright © 2006 Thomson Business & Professional Publishing. All rights reserved.

Franchise Agreement The legal agreement between the franchisor and the franchisee Franchise The benefits provided in the franchise agreement Copyright © 2006 Thomson Business & Professional Publishing. All rights reserved.

Product and trade name Franchise provides the right to use a product or name known as Business Format Franchise Provides a complete business structure and ongoing guidance from the franchisor’s responsible owner A private company or individual acting as a salesperson is responsible for finding new franchisees within. exclusive territory Copyright © 2006 Thomson Business & Professional Publishing. All rights reserved.

Franchises And Buyouts

Multi-Unit Owner A single franchise owner who owns more than one franchise from the same company Area Developers A person or company that obtains the legal right to open multiple franchises in an area Piggyback Franchise Manage a franchise by details within the physical equipment of the host store. Copyright © 2006 Thomson Business & Professional Publishing. All rights reserved.

Selecting a Franchise Opportunity Private Audit Advertising for Franchise Surveys Third Party Sources Independent of the Internet Marketing Commission Franchise Consultants Similar to Franchisors Disclosure Documents Existing and Former Franchises Copyright © 2006 Thomson Business & Professional Publishing. All rights reserved.

Subway Curves 7-Eleven Inc. Kumon Math & Reading Centers Jan Pro Franchising Int’l., Inc. The Quizno’s Franchise Co. Jani-King Coveral Cleaning Concepts Liberty Tax Service Jazzercise Inc. RE/MAX Int’l., Inc. Jackson Hewitt Tax Service Choice Hotels Int’l. WSI Internet Dunkin’ Donuts Action Int’l. Baskin-Robbins USA Co. Great Clips, Inc. Rezcity.com The UPS Store Source: “The Race Goes to the Swift”, Entrepreneur, February 2004, p. 80. Reprinted with permission from Entrepreneur Magazine. © 2004 all rights reserved. For subscription information, please refer to Attachment 4.5 Copyright © 2006 Thomson Business & Professional Publishing. All rights reserved.

Benefits Decreased capital requirements Increased administrative overhead Speed of expansion Lack of control Profit sharing Increased operational support costs Copyright © 2006 Thomson Business & Professional Publishing. All rights reserved.

Franchising A Business Pros And Cons

Franchise agreement signed in the presence of legal counsel Contains termination and transfer provisions Contains a statement of the right to renew the agreement Copyright © 2006 Thomson Business & Professional Publishing. All rights reserved.

Rule 436 Federal Trade Commission Uniform Franchise Offering Circular (UFOC) Rule 436 Documents Accepted by the Federal Trade Commission for Compliance with Franchise Disclosure Requirements Dispute and Bankruptcy History Investment Conditions Conditions That May Affect Renewal, Termination or Sale of Franchise Copyright © 2006 Thomson Business and Professional Publishing. All rights reserved.

Reasons to Buy an Existing Business To reduce some of the uncertainties and unknowns that need to be considered when starting a business from scratch. or franchising can cost starting a business faster than starting from scratch Copyright © 2006 Thomson Business & Professional Publishing. All rights reserved.

The Good And Bad Of Buying An Existing Franchise

High efficiency Poor planning efficiency Clients/suppliers with the necessary equipment Cost of sales Experienced workers Company documents Cons Cons Problems Current employee quality Poor company image Need for innovation Cost of buying based on inaccurate data Bad company position Copyright © 2006 Thomson Business & Professional Publishing. All rights reserved.

Due Diligence The exercise of prudence, as expected of a reasonable person, in carefully evaluating a business opportunity Relying on a professional accounting attorney Other experienced entrepreneurs Copyright © 2006 Thomson Business & Professional Publishing. All rights reserved.

Reasons for selling the company Old age or illness Desire to move to another part of the country Decision to accept a position with another company Not profitable in the company Loss of special sales Maturity of the sector and lack of growth potential Beware of sellers who may have “cooked the books” to attract business. Copyright © 2006 Thomson Business & Professional Publishing. All rights reserved.

Review your financial statements and tax returns for the past five years. Be aware that financial data can be misleading. Excess Assets Excess / Underestimated Expenses Net Income Less Unrecorded Liabilities Correct Copyright © 2006 Thomson Business & Professional Publishing. All rights reserved.

Reasons You Should Be A Franchisee Owner

Assess the value of the company’s assets; it does not reflect the company’s value as a business entity. Market Comparable Valuations Consider the selling prices of similar companies; the difficulty is finding comparable companies. Cash flow-based valuation Compare the expected and required rates of return with the amount of capital to be invested in the business. Copyright © 2006 Thomson Business & Professional Publishing. All rights reserved.

Terms of purchase Purchase of goods or whole business Payment terms in full or in part on time Closing the sale Better management by third parties Sales documents Tax verification Vendor payment agreements and guarantees Copyright © 2006 Thomson Business & Professional Publishing. All rights reserved.

Product and franchise business name franchise business form master regional coordinator multi-owner shoulder franchise information uniform document Franchise Offering Circular (UFOC) matchmaker due diligence Copyright © 2006 Thomson Business & Professional Publishing. All rights reserved.

Buying A Franchise: Franchise Partnerships

To operate this website, we record user data and share it with a processor. To use this website, you must agree to our privacy policy, including our cookie policy. Advantages and Disadvantages of Franchise: Franchise is a name given to the agreement in which a particular party or franchisee gives certain rights and powers to another party or franchisee. Franchising is an excellent business strategy for business expansion in the modern world.

There is a contractual agreement between the Franchisor and the Affiliate under which the Franchisor licenses the Affiliate to market its products, goods, services and the right to use its own brands and brands in the market with these operating franchisees. to be a seller.

Franchising is a characteristic that entrepreneurs give to other candidates like that. The right, as mentioned above, allows the recipient to sell the products or services of the manufacturer or some parent company within the stock market.

It is important to note that these rights may also be access to intellectual property rights.

How To Franchise A Business Pros And Cons Of Buying A Franchise By The Franchise Institute Pty Ltd

The person or company that grants the right to franchise is called the franchisor and the recipient of that right is called the franchisee. Franchising is a type of commercial business policy that helps the franchisee to cover a large part of the market.

Simply put, franchising is a business relationship between two entities in which a specific party gives the other party the opportunity to sell its products and intellectual property. For example, various fast food companies like KFC and Subway operate in India through franchises.

Franchising gained attention in the 1950s. Ray Kroc, a successful entrepreneur in 1984, saw the potential of franchising to successfully expand a Southern California burger joint owned by some brothers.

Franchising is a type of marketing and distribution strategy in which the owner of a business allows a person to manage a business that sells products or provides services through the business policies of the licensee.

The Complete Guide To Buying A Franchise

It is important for anyone who decides to start a business as an affiliate to know that the affiliate is connected to the partnership agreement.

When these franchisees come on board and sign a franchise agreement, they face the first time

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Buying A Franchise Pros And Cons

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