What is Franchising?
Are you thinking of putting up your own business? You often hear, “You should get a franchise”, “It’s much easier to get a franchise” or “Everyone’s buying a franchise. You should too”. I am not here to tell you what to do. I am merely giving information on what franchising is. You will have to decide whether you would get a franchise.
Let’s first discuss what franchising is. Franchising is a method in which franchisees are given the right to sell it’s products, right to use their name and transfer of technology/way of doing business that has been developed by the franchiser.
Franchising has become one of the most popular forms of businesses in the Philippines. Whenever you got to the mall and decide to eat outside, buy some clothes or get a haircut, you are most likely be going to one franchised outlet.
Why is that it’s so popular? Why is that more and more people resort to be franchisees? Well, the biggest advantage of buying a franchise is that you get to have a “system”.
Franchising offers franchisees the advantage of learning from the franchiser’s experience. Franchisers, after years or even months of success and experience in a certain trade provides the franchisee the system that they have developed. Franchisers have proven formulas of doing a business. It would be a lot more difficult for the franchisee to build a buisness from scratch.
The system is not the only value franchising offers. Depending on your franchise package, franchisers also assists the franchisees with site selection, personnel training, business setup, advertising and product supply.
Franchising also has its drawbacks. You lose independence. You cannot venture in something on your own. You have to follow a system that the franchisers have developed.
There are a lot of good things and bad things about franchising. So far, we have just dipped our finger in the pool. We will discuss a lot more in the future.