¿Qué es una Franquicia?

WHAT IS A FRANCHISE?

A franchise is the agreement or license between two legally independent parties which gives:

• a person or group of people (franchisee) the right to market a product or service using the trademark or trade name of another business (franchisor)

• the franchisee the right to market a product or service using the operating methods of the franchisor
• the franchisee the obligation to pay the franchisor fees for these rights
• the franchisor the obligation to provide rights and support to franchisees 

 

FRANCHISOR  

​

Owns trademark or trade name

Provides Support:  

• (sometimes) financing                 

• advertising and marketing 

• training  

​

FRANCHISEE  

Receives Fees  

        Uses trademark or trade name 

        Expands business with franchisors support
        Pays Fees

 

TYPES OF FRANCHISES: 

 

PRODUCT DISTRIBUTION  

Product distribution franchises simply sell the franchisor’s products and are supplier-dealer relationships. In product distribution franchising, the franchisor licenses its trademark and logo to the franchisees but typically does not provide them with an entire system for running their business. The industries where you most often find this type of franchising are soft drinks, automobiles and gasoline.

Some familiar product distribution franchises include:
• Coca-Cola
• Goodyear Tires
• Ford Motor Company

Although product distribution franchising represents the largest percentage of total retail sales, most franchises available today are business format opportunities.

 

BUSINESS FORMAT FRANCHISE
Business format franchises, on the other hand, not only use a franchisor’s product, service and trademark, but also the complete method to conduct the business itself, such as the marketing plan and operations manuals. Business format franchises are the most common type of franchise.

USA Today reported that the 10 most popular franchising opportunities are in these industries: 

• Fast Food 

• Service 

• Restaurants 

• Building and Construction 

• Business Services 

• Retail 

• Automotive 

• Retail-Food 

• Lodging 

• Maintenance

 

TYPES OF FRANCHISE ARRANGEMENTS:

Because so many franchisors, industries and range of investments are possible, there are different types of franchise arrangements available to a business owner. 

 

SINGLE-UNIT (DIRECT-UNIT) FRANCHISE
A single-unit (direct-unit) franchise is an agreement where the franchisor grants a franchisee the rights to open and operate ONE franchise unit. This is the simplest and most common type of franchise. It is possible, however, for a franchisee to purchase additional single-unit franchises once the original franchise unit begins to prosper. This is then considered a multiple, single-unit relationship. 

 

MULTI-UNIT FRANCHISE
• area development
• master franchise (sub-franchising) 

 

AREA DEVELOPMENT FRANCHISE 

 

Under an area development franchise, a franchisee has the right to open more than one unit during a specific time, within a specified area. For example, a franchisee may agree to open 5 units over a five year period in a specified territory. The franchisor grants the franchisee exclusive rights for the development of that territory.

 

Another hybrid-type of multi-unit franchise is an area representative franchise. In this model, the area representative buys a territorial franchise to sell and service unit franchisees in the territory. The area representative does not contract with the unit franchisees (who sign agreements directly with the franchisor), but does receive a portion of the initial fees and ongoing fees paid by the unit franchisee to the franchisor.

 

MASTER FRANCHISE

 

A master franchise agreement gives the franchisee more rights than an area development agreement. In addition to having the right and obligation to open and operate a certain number of units in a defined area, the master franchisee also has the right to sell franchises to other people within the territory, known as sub-franchises.  Therefore, the master franchisee takes over many of the tasks, duties and benefits of the franchisor, such as providing support and training, as well as receiving fees and royalties.

     

 

 COMMON FRANCHISE TERMS

 

• Business format franchise:This type of franchise includes not only a product, service and trademark, but also the complete method to conduct the business itself, such as the marketing plan and operations manuals.   

 

• Disclosure statement: Also known as the FDD, or Franchise Disclosure Document, the disclosure document provides information about the franchisor and franchise system.  

 

• FDD: The Franchise Disclosure Document, FDD, is the format for the disclosure document which provides information about the franchisor and franchise system to the franchisee.  

 

• Franchise: A license that describes the relationship between the franchisor and franchisee including use of trademarks, fees, support and control.  
   

• Franchise agreement: The legal, written contract between the franchisor and franchisee which tells each party what each is supposed to do.  
   

• Franchisee: The person or company that gets the right from the franchisor to do business under the franchisor’s trademark or trade name.  
   

• Franchising: A method of business expansion characterized by a trademark license, payment of fees, and significant assistance and/or control.  
   

• Franchisor: The person or company that grants the franchisee the right to do business under their trademark or trade name.  
   

• Product distribution franchisee: A franchise where the franchisee simply sells the franchisor’s products without using the franchisor’s method of conducting business.

   

• Royalty: The regular payment made by the franchisee to the franchisor, usually based on a percentage of the franchisee’s gross sales. 

  

• Trademark: The marks, brand name and logo that identify a franchisor which is licensed to the franchisee.  

 

 

WHAT ARE THE ADVANTAGES AND DISADVANTAGES OF OWNING A FRANCHISE? 

 

ADVANTAGES

“Owning a franchise allows you to go into business for yourself, but not by yourself.”

A franchise provides franchisees with a certain level of independence where they can operate their business.

A franchise provides an established product or service which may already enjoy widespread brand-name recognition. This gives the franchisee the benefits of a pre-sold customer base which would ordinarily takes years to establish.

A franchise increases your chances of business success because you are associating with proven products and methods.

Franchises may offer consumers the attraction of a certain level of quality and consistency because it is mandated by the franchise agreement.

Franchises offer important pre-opening support:

site selection 
design and construction 
financing 
training 
grand-opening program

Franchises offer ongoing support:

training 
national and regional advertising 
operating procedures and operational assistance 
ongoing supervision and management support 
increased spending power and access to bulk purchasing 

 

DISADVANTAGES

The franchisee is not completely independent. Franchisees are required to operate their businesses according to the procedures and restrictions set forth by the franchisor in the franchisee agreement.

These restrictions usually include the products or services which can be offered, pricing and geographic territory. For some people, this is the most serious disadvantage to becoming a franchisee.

In addition to the initial franchise fee, franchisees must pay ongoing royalties and advertising fees.

Franchisees must be careful to balance restrictions and support provided by the franchisor with their own ability to manage their business.

A damaged, system-wide image can result if other franchisees are performing poorly or the franchisor runs into an unforeseen problem.

The term (duration) of a franchise agreement is usually limited and the franchisee may have little or no say about the terms of a termination. 

 

 

Source: www.franchise.org