What is franchising Archives - Franchise Association South Africa

Understanding the franchise business format

by FASA Franchise Association South Africa

Business and Franchise Advice, What is franchising

Understanding the franchise business format

In a strictly legal sense, every franchise agreement is entered into between a franchisor and one specific franchisee. What is frequently overlooked however is the fact that three other parties will be affected, to a greater or lesser extent, by every such agreement. Unless the franchise agreement enables the franchisor to exercise adequate control over the way each franchisee exercises his rights and carries out his obligations, the entire network of company-owned and franchised stores, its suppliers and its customers could suffer from the actions of one errant franchisee. FASA Franchise Association South AfricaTo protect, lobby, promote and develop ethical …

Franchising is about…operational systems

Globally, franchised businesses are considered more successful than regular start-up businesses – with the failure rate of franchises at on average 10% or less to independent businesses over 90% in the first few years of business. Although the success of any business ultimately depends on the person who owns and runs it, a franchise business, with its business format system, offers a greater degree of protection from the cold winds of economic disruptions. Its support system of testing, training, operational systems, marketing and bench-marking is down to the basic fact that they succeed because they follow a tried and tested …

What is franchising all about?

Franchising is an extremely good distribution method and without question the most successful small business format in the history of business. What is Franchising? The ‘franchisor’ or person, who starts a company or develops a concept, uses others (franchisees) to duplicate his concept and distribute it on a large scale. This inter-dependency forms the basis to the business format and its success lies in the effective implementation of certain basic but clearly defined business principles. The juxtaposed relationship between franchisor and franchisee needs to be fully understood and accepted for the overall business to succeed. FASA Franchise Association South AfricaTo …