Franchising is also called a franchise is a business that is quite profitable. If interpreted, franchise is a business between the owner of the product, brand or operating system with a second party, namely the granting of permits for the use of brands, products and operational systems within a predetermined period of time. Franchising or franchising applies a partnership system.
Meanwhile, according to the Indonesian Franchise Association, franchising is a system for distributing goods or services to customers, where brand owners or better known as franchisors give rights to individuals or companies to conduct business with names, systems, procedures, brands, and methods. predetermined within a certain period and covers a certain area.
In the world of franchising or franchising, there are two terms, namely franchisor and franchise. Franchisors are also referred to as franchisors, can be individuals or business entities that give rights to other parties to use and / or utilize human rights over intellectual property or the characteristics of their businesses. Meanwhile, the franchisee is a franchisee, both business entities and individuals. Franchise is given the right to utilize and or use intellectual property rights or characteristics of the franchisor.
Types of Franchise Business / Franchise
Based on the criteria, franchising is divided into three types, namely product, service, and combined franchises.
- Product Franchising : Product franchises offer goods for sale. It can be food, drink, used goods, or other finished goods.
- Service Franchise : Meanwhile service franchises offer tangible services. Examples include spa services, courses, travel agents, and so on.
- Combined : For this one type is a combination of the two. One example is the family spa which also sells health products.
Meanwhile, according to the International Franchise Association (IFA) Franchise is divided into 4 types and is widely applied in the United States, namely as follows:
- Product Franchise : Franchise of this type, the manufacturer has full control over the retail that distributes its products. In the contractual agreement, the manufacturer allows the shop owner to use the trademark as well as the copyright. But on condition, the shop owner must pay a certain amount of money in order to obtain this right or to buy products that qualify for the franchise.
- Manufacturing Franchise : In this type of franchise, you are given the right, to sell the franchise’s products to the public without knowing the company’s secret recipe. Usually, this is found in the food and beverage industry.
- Business Opportunity Ventures : Business owners are required to buy and also distribute products from certain companies. Meanwhile, companies must also provide accounts for business owners. In practice, the business or business owner must pay a fee as proof of reciprocity or compensation.
- Business Format Franchising : Business integration is more comprehensive and also complete. In this franchise, the franchisee distributes products and or services from the franchisor under the copyright of the franchisor while implementing the format and procedures imposed by the franchisor in the business. In doing so, there is an agreement that applies legally, which includes the name of the franchisor, products and services, procedures, SOPs, marketing systems, and also supporting facilities.
Tips for Starting a Franchise Business
You don’t have to spend a lot of capital to be able to develop this one business. Even running a franchise business makes us not feel burdened in doing it because it is done together. You will also get training. For those of you who want to be successful in running a business or franchise, the following tips must be applied:
1. Choose a franchise that is easy to run
If you are really new to franchising, it is highly recommended to choose a franchise that is not too difficult to run. Don’t push too hard to do the hard one right away. The easier the franchise business you do, the time and thought will not be consumed too much. Therefore, choose one that is easy and also practical.
2. Select the product prices are affordable
Every businessman and entrepreneur, of course, wants the business he runs to get a big profit. Right? This is in line with the economic principle of making certain sacrifices in order to get the maximum possible result. This also applies to the franchise business.
If you want to get the maximum profit possible, what you have to do is choose a franchise that sells products at affordable prices. This of course can reduce capital so that the profit you get is also increasing. Especially if it is supported by prime quality, of course it makes this business excellent in the eyes of consumers.
3. Look for Franchises that Consumers Frequently Look for
Not all types of products or goods are liked by many people. You must be able to understand this so that the franchise business you are doing is successful and sells hard. For now, the franchise that is most in demand and sought after by consumers is a culinary franchise. Of course, this is not without reason, considering that food is one of the most important needs in human life, so it must always be sought and will always be sought after anytime.
In almost every corner of the city, you will easily find this culinary business. Examples of popular culinary delights include chicken noodles, fried rice, meatballs, and satay. If you want to try something else, you can conduct research or survey first to find out what products or items are often sought after and needed by consumers.
4. Choose a franchise with good service
You should also pay close attention to the services from the franchisor. Don’t be careless in choosing it. You have to be smart to choose if you want to join a franchise owner. Choose the one that provides the best service, for example, such as good communication, product or product warranty, and training or courses that are still related to the franchise business.
5. Determine a Strategic Location
In running a business, place is also a determining factor for the success of the business you run. Make sure you choose a really strategic place, in the sense that potential buyers can find out that you are running a business. Choose a location that is approximately quite busy, such as near schools, colleges, housing, or the side of the highway. In addition, also adjust to the goods or products that you are going to sell. For example, if you sell ice cream then choose a location where the people around there really like to drink ice.
If these five are done, God willing, the franchise business that you start can grow rapidly and generate huge profits. So many articles about franchising, I hope this article is useful and thank you.