Franchising offers would-be entrepreneurs the opportunity own a company with both name recognition and the support of established firms doing identical work.
Moreover, franchise ownership is, to a large extent, guesswork-free, as franchisors routinely provide guidance on everything from site selection to marketing and training. Some franchisors offer continuing support, such as monthly newsletters, toll-free telephone numbers for technical assistance, and occasional workshops or seminars.
On the downside, franchise ownership entails limitations and rules some entrepreneurs find restrictive. F
ranchisors often impose design and appearance standards; restrict goods and services offered for sale, and dictate operation procedures, to cite the most obvious examples. And while owning a franchise may involve less risk than other startups, success is by no means guaranteed.
There are generally two types of franchise arrangements – product distribution arrangements, whereby a dealer is partially identified with a manufacturer or supplier, and business format franchises, in which the buyer has complete identification with the dealer.
To help explain these and other details, the IFA convenes a series of franchising expos around the country each year. These weekend-long events bring together prospective franchisees and representatives from hundreds of franchise companies.
In addition to the franchising companies themselves, information is available at the IFA Web site, www.franchise.org.