Insights

Why franchise?

Lower costs and lower investment

Unlike employees, franchisees will pay you an entry royalty and a service royalty as part of your franchise. In addition, the franchisee will make an investment aimed at expanding your brand. Therefore, the cost of opening new stores under your brand will be financed by your franchisees. Also, if your concept is successful, franchisees will gladly pay you a service royalty every month. The key, of course, lies in a successful concept and in investing enough time and money into creating an attractive franchise opportunity.

Simplified management

Franchise solves one of the biggest problems in business – hiring employees, managing them, and paying them. Franchisees are responsible for the daily operational management of their franchises according to the standards of your concept and in accordance with the franchise agreement they have signed with you. Since franchisees invest their own capital, they do not require management — they take care of their own investment, that is, your franchise. Ultimately, a franchise network requires very simple and cost-effective management to run the franchise chain.

Rapid expansion and growth

One of the biggest advantages of franchising is the expansion of your business and much faster growth compared to investing in your own expansion. Franchising simply comes down to replicating successful models and concepts. For example, with master franchise models, you can expand internationally very quickly. The more you grow, the stronger your organization will become financially, and the more recognizable your brand will be.

Better market penetration

Franchisees are often better connected within the local community where they operate and can more easily gain access to, for example, the best locations or contacts that would otherwise be difficult to reach. Additionally, franchisees have a better understanding of the area in which they operate and can more easily adapt the business to the local community.

International potential

Becoming an international brand is not easy if you build it in the traditional way. In addition to investments and connections, this area of business is characterized by many barriers such as language and cultural differences. However, it is much easier to become an international brand through the franchise model, and it is quite common to achieve global recognition this way.

What types of businesses can be franchised?

There are currently many different categories of franchises around the world. Some of the most common ones include restaurants or food and beverage concepts, retail concepts, tourism and accommodation services, financial services, cleaning services, real estate agencies, manufacturing franchises, digital franchises, and more. In other words, almost every successful and replicable business concept on the market can be franchised and used to build a thriving network.
To determine whether your business is franchiseable, ask yourself the following questions:
  • Do you have specific knowledge about your business that you can transfer to franchisees?
  • Is your business operationally profitable? If so, could a franchisee recover their investment within 5 years?
  • Can you systematize your business?
  • Can your business be replicated internationally?
  • Are you willing to help others succeed?
For anything related to franchising, franchise consulting, or any type of franchise, feel free to contact us, including for a free evaluation of your concept.

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