Franchise question;

MarkD.

As above, if a private company for instance "Joe Blogs Ltd" were trading well, had a reputeable name and had a good product/service that appealed to you could you approach them about me buying Franchise rights off them i.e starting up a branch in your area where they are not loctaed already? or can they only sell franchise rights if they are some sort or registered franchise chain like McDonalds, KFC etc.

Help would be greatly appreciated.

Regards
Mark

Gloomtastic!

If you don't ask you don't get.....

However, as a franchisor they will be expected to:

1. Supply you with a detailed operators manual that will outline every aspect of their business.
2. Be able to offer you management support and training.
3. Buy all your stock on your behalf.
4. Have a high enough profit margin to justify not only a management fee (usually 10%+) but also a franchise fee and still allow the franchisee to make a decent profit. A profit margin of over 50% is the norm.

MarkD.

Gloomtastic! wrote: »

If you don't ask you don't get.....

However, as a franchisor they will be expected to:

1. Supply you with a detailed operators manual that will outline every aspect of their business.
2. Be able to offer you management support and training.
3. Buy all your stock on your behalf.
4. Have a high enough profit margin to justify not only a management fee (usually 10%+) but also a franchise fee and still allow the franchisee to make a decent profit. A profit margin of over 50% is the norm.

Thanks for that reply. As you said you dont know unless you try.

Would there not be an awful lot of red tape for the franchise provider and the prospective franchisee to plough through if the parent company was outside of Ireland? Would a sales agent be a better alternative, or does the franchise option win hands down

Gloomtastic!

MarkD. wrote: »

Thanks for that reply. As you said you dont know unless you try.

Would there not be an awful lot of red tape for the franchise provider and the prospective franchisee to plough through if the parent company was outside of Ireland? Would a sales agent be a better alternative, or does the franchise option win hands down

The red tape is just part of business, it justifys the franchise and management fee. The reason franchises are successful is in part due to the fact that they are owner-managed as opposed to just managed. It takes a lot of the risk out of the business for the business originator. So yes a sales agent would probably be more profitable but the franchise model is safer.

YellowSheep

Hi Mark

Before you approach "Joe Blog", sit down and analyze their business and what YOU are actually like about it. Perhaps you could do it yourself without going into franchise contracts and fees. Also if "Joe Blog" never franchised, it can take a long time until they would get ready or even their head around it. Not everybody has a vision. May I ask what business "Joe Blog" is operating?

Cheers YS

MarkD.

YellowSheep wrote: »

Hi Mark

Before you approach "Joe Blog", sit down and analyze their business and what YOU are actually like about it. Perhaps you could do it yourself without going into franchise contracts and fees. Also if "Joe Blog" never franchised, it can take a long time until they would get ready or even their head around it. Not everybody has a vision. May I ask what business "Joe Blog" is operating?

Cheers YS

Ya I understand what your saying YellowSheep, its in the security industry. Thats all I'll say awhile. Thanks again for your answer

antoinolachtnai

Usually franchise concepts work well with high-gross-margin products and services. Most security stuff doesn't fit into this bracket.