Most people dream about owning and running a business, and dream for years to be their own boss but do not know how to go about it or fear of failure. Franchising is an opportunity to turn that dream into reality.
The most common method is Business Format Franchising- when you buy a franchise, the franchisor grants you, the franchise, the use of their logos and trademarks, as well as a turn-key system for doing business. The franchisee in return has to pay an upfront franchise fee as well as ongoing royalties to the franchisor. No previous experience in a particular business is necessary for a franchise to manage the business. All deficiencies of know-how are made good by training imparted by the franchisor.
Franchising help to reduce the risk of business failure, because an ethical franchisor will have tried, tested and proven the business concept in the marketplace. Franchising enables a small business owner to compete with a big business, a franchise can take advantage of the economies of scale. It also enables a franchise to trade under a recognized brand.