How Does a Franchise work?

How does a franchise work?

Quite simply, a franchise is a method of distributing a business’s products or services.

Think of a national retail chain which has grown through corporate investment in new sites, extra staff, and advertising campaigns promoting its merchandise.

Franchising is an alternative to the owner building a chain of stores or business units that they fund, manage and staff themselves.

It allows individuals to trade on the goodwill of a brand name and gain from the company experience.

This is how a franchise works

Typically the owner of a business (known as the franchisor) licenses to a third party (known as the franchisee) the right to operate a business or distribute goods and/or services using the franchisor’s business name and systems for a set period of time.

Of course the franchisee will pay a fee for this, which may be an upfront payment by the franchisee to the franchisor, an ongoing fee (an agreed percentage of revenue or profit) or a combination of the two.

Why is franchising so popular?

The simple answer is that franchising provides benefits to both franchisors and franchisees, as they share in the success of the business operated by the franchisee.

Six franchisor benefits

Expansion isn’t dependent on the franchisor’s capital but the resources of the franchisee
Improved performance: a franchisee’s investment in the business is likely to make them more committed to success than a corporate manager
Speedy growth of the network
The franchisor can service national customers
The franchisor is not handling the day-to-day operations of each business unit
There is less capital risk

Six benefits of being a franchisee

Access to a well-known brand and the buying power attached to a bigger operation
Assistance in choosing a location and setting up the business
Ongoing support and training from experienced professionals
Mentoring and business advice from fellow franchisees
A common marketing program
Some legal protections are provided to franchisees by the Franchising Code of Conduct, which is administered by the ACCC

Franchising in Australia

Today in Australia franchises are well represented across the small business sector, from mobile services to food chains to educational programs.

Annual revenue from franchising is in excess of $100 billion with franchises employing more than 500,000 people.

July 17, 2017/by admin

Franchise For Sale

Things that Annoy Potential Franchise Buyers

Do you remember the last major purchase you made?

If so, would you describe it as being a smooth, easy process and transaction, or difficult and

frustrating, infuriating you to no end?

If it was a smooth transaction, congratulations!

But if it wasn’t, and you happen to be thinking about buying a franchise, a major purchase, the

following is worth considering.

A recent article reported that, among the things that frustrate franchise buyers is dealing with

salespeople. As most people don’t know how to buy a franchise, they are reliant upon the

salesperson providing the information they need to make a buying decision.

Another frustration is all the legal “mumbo jumbo” involved. For example, the FDD, (Franchise

Disclosure Document) is a couple hundred pages of legal terms, financial information, etc., etc. It’s

not the most exciting thing you’ll ever read, but it’s a must-read when buying a franchise.

All the paperwork, reading, research, disclosures, documentation, and obligations are legal

requirements and necessary details when considering a franchise agreement.

In the meantime you just want to find out whether the franchise is suitable for you.

We want to make your experience with us as smooth as possible.

If you’d like to save time, and lower your frustration level, we believe we have the answers.

We have been franchising for over 30 years and we have learned many things along the way.

Why not try before you buy? You’ll soon know if Jim’s Mowing has the right “feel” for you.

The vast majority of our successful franchisees have all agreed that it was what we call the franchise

ride-along program (or trial day program) that convinced them to join Jim’s Mowing. A prospective

franchisee is strongly encouraged to spend a day with a current franchisee as a ride-along or to

participate in a “hands-on” trial day.

Spending a day in the field with a current franchisee is an opportunity to experience first-hand what

it’s like to run a Jim’s Mowing franchise. Working alongside the franchisee you’ll see how our system

works and have access to the inner workings of the business.

In just about all cases, experiencing “a day-in- the-life” delivers what you need to know and allows

you to move forward with confidence. Can you imagine buying a house without attending an open

house? Would you buy an expensive car without a test drive?

So, before you are inundated with all the mandatory paperwork, we invite you to:

1. Call our local franchisor Chris Hansen on 0402 466 341 for an informal chat

2. Arrange a ride-along trial day by calling our offices on 02 9899 8299

Should you decide to go ahead we do recommend that you then meet with a solicitor to review all

those mandatory documentation details.

July 6, 2017/by admin

Franchise For Sale

What do an Open House, a test drive, Jim’s Mowing and a bucket list all have in common?

“It just does not have the right feel.” Call it Feng shui or whatever, a brilliant website, a glossy brochure, a virtual tour and even sleek Harriet the super salesperson, is not going to convince someone to buy a house if it does not have the right “feel.” Hence, savvy real estate agents offer an open house for prospects to see how the home “feels.”

Great TV ads and promotions to get a person to the car dealership (and even sleek Harriet’s counterpart) in most cases will not result in a sale unless there has been a test drive. Heck some dealerships even offer for you to take the car home for a couple of days.

In both cases, these transactions are “major purchases” (for most people at least) and buying a franchise is a major investment.

Jim’s Mowing has the website, the glossy brochures, the franchise information kit, (but not sleek Harriet or the sales champion).

The vast majority of our successful franchisees have all agreed that it was what we call the franchise ride-along or trial day program that convinced them to join Jim’s Mowing. A prospective franchisee is strongly encouraged to spend a day with a current franchise as a ride-along or to participate in a “hands-on” trial day.

Why not try before you buy……you’ll soon see if it has the right “feel” for you?

Spending a day in the field with a current franchisee is an opportunity to experience first-hand what it’s like to run a Jim’s Mowing franchise.
Working alongside the franchisee you will see how our system works have access to the inner workings of the business.
In just about all cases, experiencing “a day-in-the-life” delivers what you need to move forward with confidence.

Oh, now about that bucket list.

It is estimated and in excess of 80% of people “would love to own their own business” or “be their own boss” and less than 5% actually do something about it. This is your opportunity to have no regrets and to not look back and say “I always wanted to know what or would be like to have that a mowing business of my own.”

A Jim’s business is not for everyone. It’s hard work. It can be physical. You’re out in the sunshine, and sometimes the wind and rain but it can be very rewarding.

For further details watch our videos

June 2, 2017/by admin

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