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What does a franchise provide?

-Franchising also requires commitment, the time, effort and the money that one would spend on franchising would surely merit an investigation by both the franchisee and the franchisor. - the franchisor not only looks at the location of the outlet but also, usually, on the financial and management capability of their prospective partners. -In return, the franchisee has to make sure that it is able to meet the expectations of the franchisor.

1. Business name 2. Market research 3. System ideals and the operating manuals 4. Proprietary marks 5. Experience 6. Good judgement of the franchisor 7. Training 8. Location assistance and approval 9. Store layout and construction supervision 10.Exclusive area coverage 11.Procurement programs 12.Hiring assistance 13.Grand opening assistance 14.Marketing strategies

15. Effective field service 16. Research and development

Business Name
-The franchisee may have a different company name but its products should have the names that are patented by the franchisor. -The name and the way it is written designed or printed should be uniform with the other franchise outlet.

Market Research - The marketing research of the franchisor should benefit the
- It will serve as guide to help the franchisor in evaluating the proper location, promotions, personnel, distribution and the target segment.

System ideals and the operating manual

-The system ideals are written on the operating manual which should be provided by the franchisor. - It describes how things should be conducted in the operation of the system. -The operating manual communicates the complete operating operating procedures necessary to maintain the standards of the franchisee.

Proprietary marks
-Include the logo, slogans and other printed signs that show distinction of the franchise. -The franchise is allowed to use the patented marks of the franchisor.

-This is an important service that the franchisor provides to the franchisee. -With the vast experience of the franchisor, the franchisee avoids mistakes commited by a new and growing company. -It will help reduce losses brought about by the miscalculation of risks.

Good Judgement of franchisor

-Along with the experience comes the knowledge gained through the past mistakes and success. -The franchisor, especially those whose franchisee organizations have been existent for a long time, has been endowed with the wisdom to judge circumstances. -The franchisee may be able to get sound advice from the franchisor regarding the business.

-Franchisor provide training assistance to the franchisee.

-This is a critical aspect of the franchisee because training does not only provide knowledge of the operation but more importantly, it highlights and emphasizes the contextual framework for the franchisee.
-The continuous training provided by the franchisor organization avoids poor management.

Location assistance and approval

- Prospective franchisee have to look for suitable location where the business establishment will be built. Franchisor can guide the franchisee by giving ideas on where a franchise would likely get more sales. They will be the ones to inspect the location and judge if it is deemed fit for the business.

Store layout and construction supervision

-Franchisor give the franchisee the specification for the construction of the stores. -These specifications are based on careful planning that would bring about the efficient operations. It also includes how the store facilities will be installed, the color of the walls, decoration and other pertinent materials necessary to bring about the ambiance and the distinction of the store.

Exclusive area coverage

-Franchisors provide exclusive territories to franchisee holders. - Exclusive territory means that no other franchise coming from the same organization may overlap territorial limits set by the contract. -The franchisee may enjoy a wider coverage depending on the type of franchise applied for.

-Exclusive areas provide the outlet with the needed target population without the threat of competition coming from the same organization.

Procurement programs
-Franchisee organizations share the system of procurement with the franchisees. -It provides the list of authorized suppliers for different needs of the franchisee outlet. -The suppliers give franchisees the product at discounted prices.

Hiring assistance
-The franchisor usually gives the franchisee the guidance needed in hiring personnel that would fit the nature of the organization. - ensuring qualified personnel is an important preparation prior to opening of the outlet.

-The assistance is helpful especially to those who are just beginning to run their own business.
-The organizations commonly sets aside the some of its personnel to help the franchise in selecting or screening of applicants.

Grand opening assistance

-The opening is a highlight event of the franchise outlet. -It is common to see businesses employing propaganda so that many may know of their opening day. -The opening day is when all of the training and plans will be operationalized. -It may be possible that some glitches may occur at the operation. -The franchise organizations management and staff lend a helping hand to make sure that everything goes smoothly starting at day one.

Marketing strategies
-The franchisor is generally familiar with tested and proven strategies to guide the franchisee to remain competitive. -It includes aspects of advertising and different promotional tactics designed to ensure continued profit.

Effective field service

-franchisor also provide well trained and knowledgeable sales personnel to help the franchisee resolve difficulties in the workplace.

Research and Development

-The franchisee must see to it that the business does not remain stagnant. -The franchisor spends time to ensure that improvement in products, services, equipment, operation processes, will happen. -Research and development to beat the competitors.

Choosing a Franchise 1. Why an entrepreneur may buy a franchise.

Reasons why an entrepreneur may decide to go into business by acquiring a franchise: Earning depends on the effort. Opportunities for unlimited income

1. 2.

3. Personal satisfaction 4. Tax benefits 5. Freedon to pursue the job you want 6. Assurance of continuous employment 7. Eliminates the difficulties in starting up 8. Ease in operationalizing the business plan 9. Benefits of having an establised system 10. Benefits from quality research and development

11. Quicker start-up 12. Probability of success is high

Earning depends on the effort

-A lot of people feel restrained by working in a company.
-They are not contented with the salary they receive.

-The amount of compensation they receive does not reflect in the income they get.

Opportunities for unlimited income

-a common similarity among wealthy people is that they own business. -Owning a franchise gives one the chance to earn relatively large sums especially if the franchise is a real crawd drawner. -Succeed in running a business and gain financial strength.

Personal satisfaction
-success may be measured in two ways: by the amount of money and property one acquires and by the amount of personal satisfaction gained in doing certain matters. -There are a lot of wealthy individuals that will declare that although having money brings, benefits, personal fulfillment brought about by achieving dreams, making a management turnaround, employing people are more self gratifying.

Tax benefits
-Owning a business venture may spell a lot of perks for the entrepreneur.

-The entrepreneur can spend substantial amount for cars, travel and reflect it as company expenditure.

Freedom to pursue the job you want

-owning a franchise allows a person to choose whatever typeof work he/she wants to do in the operations. -Having a franchise merits that the entrepreneur will never be laid off, fired if transferred. -This allows certain degree of flexibility unlike in working for a company wherein you are confined to a rigid description of your job.

Assurance of continuous employment

-Unlike working for a company where there is uncertainty of tenure, the entrepreneur has say on the continuity of the venture. -The entrepreneurs capability to manage is a big factor in the business process.

-Good management allows quality time with the family, friends or for recreation.

Eliminates the difficulties in starting up

-The franchisors experience puts the franchise in middle of the race.

-In starting a business, the entrepreneur starts from scratch.

-Franchising eliminates those start up years that are very crucial stages of the ventures.

Ease in operationalizing the business plan

- Starting a franchise eliminates the nitty gritty of a business start up. -The entrepreneur does not have to worry too much about the business plan because it has been done. -All the entrepreneur needs to do is to actualize what the franchisor has provided.

Benefits of having an operationalized system

-this is an advantage for the entrepreneur as a lot of time may be saved for just thinking if effective systems for the business. -Franchise organization, with all its experiences and resources, provide a big plus factor in business success in the form of its business method.

Benefits from high quality research and development

-franchise organizations, especially those enjoy a degree of success, has a responsibility to develop itself to maintain that status. -Research and development is a part of their operations. -Franchisees obtain the benefits of this research. This is what the royalties, advertising, and other annual fees bring to the business.

Quicker start up
-the preparations prior to start up are less time consuming for a franchise as compared to starting a business. -The initial preparations for franchising have already been made by the franchisor.

Probability of success is high

- there are surveys that will reflect the overall success of franchising not only in the philippines but in other countries as well.

2. Consideration in selecting franchises

Following points: 1. Cost of investment a. Franchise fee b. Set up iperation c. Operational expenses and purchase d. Royalties e. Advertisements 2. 3. 4. 5. 6. Franchisees preference and interest Location of the franchise Reputation of the franchise organization Franchise support and assistance Possibility of obtaining a master franchise

Cost of investment
-the amount to be shed for a franchise is substantial. a. Franchise fee - Depends upon what type of business b. Set up operation - These are expenses incurred for the renovation or the construction of the building. c. Operational expenses and purchases - The franchise may have to shell out some amount to ensure the flow of operation since the initial sales may not be enough to cover the needed expenditure.

d. Royalties -This is the amount paid to the franchisor periodically.

-Royalties are per year basis -This is the mode of income of the franchisor. e. Advertisements -Franchisees are required to pay some designated amount for the advertisements. -This is a relatively small amount compared to the benefits the franchise outlet would get especially if the advertisements is good.

Franchisees preference and income

-though not a very important factor, having a business that fits the entrepreneurs personality may help entice him/her to do the job extraordinary well. -The entrepreneur may find the work not as a work but as a way to enjoy him/herself.

Location of the franchise

- this is the extremely important factor in the business. - One should have look for a location that has access to a sizeable number of people, has floor area that may accommodate customers has available parking space for customers and for service vehicles.

Reputaion of the franchise organization

-One should check the franchise organization before joining in. It is not a joke to have a franchise.

Franchisor support and assistance

- Prospective franchisees should check wether the franchise organization has continuing services offered like product and service development, promotion and public relations designs, quality control programs and financial and administrative programs.

Possibility of obtaining a master franchise

-a master franchise is a franchise that is offered by a foreign franchisor to a single party in the philippines.

-It may also apply to a local company that has plans of extending its operations to other places and wants to apply their management style in all the stores -They are the ones that offer sub franchises to other people interested in the business.
-The cost of master franchise are smaller than the sub franchise.