OECD countries and particularly US has a very matured business practice of franchising their product,service or process through franchisees. Some important facts about US franchising are -
- There are an estimated 3,000 different franchisers (franchise business companies) operating in the U.S. today.
- It is estimated that there are over 900,000 franchise businesses across 300 business categories in the U.S. which provide nearly 18 million jobs and generate over $2.1 trillion to the economy.
- According to the U.S. Census Bureau franchises accounted for 10.5 percent of businesses with paid employees in approximately 300 industries that franchising data was collected from in 2007.
- According to the IFA (International Franchise Association) almost 4% of all small businesses in the USA are franchises.
- There are More than 300 different industries and business categories that use the franchising business model as a means to distribute goods and services.
For many entrepreneurs franchising can be an ideal model to start their business. Franchising requires mature business practice and robust legal frame work. Many emerging countries like India has adopted this business model very successfully.
We assume that the company already knows about which market to go or they can use Scaale Sales Advisory to find out where they want to go.
Size of the potential market, exiting players, how they sell it? what is the differentiator ? details like pricing, regulatory compliance, logistics, import duty etc.
Compliance issues, permits and licenses, contracts, suitability of using terms of existing franchisees in the new market, tax issues etc.
Check real estate, technology, broadband issues in case of retail outlets . Get the real estate brokers on board to evaluate viability.
Each company may need totally different set up of experts for developing franchisees from supply management issues to tax consultants. We will develop the project team of experts.
Based on the set up process which will provide the plan for number of franchisees. The process will be as following :
We will mutually decide the type of franchisees needed. Our team will find the potential franchisees . The list of potential franchisees will be approved by the company.
Our team will negotiate the terms with the shortlisted potential franchisees. Once there is initial confirmation from potential franchisees , they will meet with the company for mutual approval.
After the franchisees meet with the company and once they have mutually agreed to go ahead with the negotiated terms, our team will close the deal involving all stakeholders.
Once the franchisees are established, Scaale Sales can provide the Franchisee Audit service which can be customized.