What kind of franchise are there

We do not SPAM you. We don't share our mailing list. Toggle navigation. Business Format Franchises The most common type of franchise relationship is known as a business format franchise which provides an entire operating system for the franchise business to its franchisees. Product Distribution Franchises A second type of franchising relationship is the traditional or product distribution franchise.

Next ». All Articles ». The Tube Interviews. Pending Request s. Click to Complete Request s ». The product distribution franchise method is used often for larger products, such as vending machines and cars.

Some of the big brands which use this concept are Coca-Cola and the Ford Company. Interestingly, although the business format franchise is the most popular, the product distribution franchise actually represents the highest percentage of total retail sales. This franchise focuses on the franchisee managing the franchise. The manager does not really need to part take in the day to day running of the business. Management franchising is great for resale franchises , which are franchises that are bought from an existing franchisee , as all the operational day to day tasks and activities are in place including the existing staff.

If your chosen franchise has not been performing well, then you may have to implement serious changes to the staff or the day to day operations. Choosing the right type of franchise for you will depend on certain factors as the three types of franchises described have their own benefits, and differ mainly due to the functionality of the business.

The industry in which your business is in, will dictate what type franchising method you go for. Another thing to consider is that, your personal ambition and willingness to be flexible will also affect this decision. A business format franchise may be seen as a little more restrictive in comparison to management franchise, where you may have more flexibility with the ways in which you want to manage your business.

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Raindrop Pension Set up your future with a private pension in just 10 minutes. Do I need an accountant for my limited company? Business format franchising is the most popular type of franchise system and the one generally referred to when talking franchising. Businesses from more than 70 industries can be franchised, and the most popular are fast food, retail, restaurant, business services, fitness and other.

Typically, these are large scale projects which require a large capital investment, such as hotels and the larger restaurants. The franchisees usually invest money and engage either their own management team or franchisor to operate the business and produce a return on their investment and capital gain on exit.

Conversion franchising is a modification of standard franchise relationships. Many franchise systems grow by converting independent businesses in the same industry into franchise units. The franchisees adopt trademarks, marketing and advertising programs, training system and critical client service standards. They also usually increase procurement savings.