Is The Franchise Business Model Something For You
Franchise according to the dictionary means "Granting authorization to someone to sell or distribute a company´s goods or services in a certain area or certain places". Franchise is a license granted by a company or firm on certain terms and conditions to an individual or firm to operate a retail outlet in a specified area or place. The company or firm which grants the license is called as franchisor, where as, the individual who accepts the terms and conditions to operate a retail outlet is called as franchisee. Here the franchisee agrees to use the franchisors brand name, products, services, promotions, selling methods, add display and distributions on certain terms and conditions. The franchisee pays a fee to the franchisor for the license to sell its products, services or goods.
This type agreement helps both parties, the franchisor gets new area to establish business where as the franchisee will get already developed brand products and having no guess work about what to do, because all development and decisions are made by franchisor and everything is laid out, step by step, with nothing missing or left to chance and it all works with precision. The Legal Aspects of Franchising In legal terms franchise is a contract. The franchisee is usually granted an exclusive territory in which he or she is the only distributor of the particular products or services in a specified place. The franchisor is obligated to assist the franchisee through advertising, promotion, research and development, quantity purchasing, training and education etc. In 1979 the United States legislature had enacted the laws to protect prospective franchisees from being deceived by the falsehoods of franchisors.
The franchisor has to disclose all financial details such as profit, operating cost, recurring expenses and five year actual sales statement and these laws are known as financial discloser law. A franchisor also has to disclose the background of the company including the business experience of its high level executives and whether any of its executives, within the last seven years, have been convicted of a felony or involved in litigation franchise business fraud, or have been involved in any proceedings for bankruptcy. In addition to this disclosure factual description of the franchise and statement of the total funds to be paid such as initial franchise fees, deposits, down payments, prepaid rent, and inventory purchases is mandatory. Conditions must also be clear on recurring costs such as royalties, rent, advertising fees etc.
Keith George always writes about valuable news & reviews. A related resource is Franchise Further information can be found at Trends & News
Things for potential homebuyers to consider - Things you should consider before buying a home
Everybody dreams to own a house.
Consider Alcudia and Pollenca for Your Dream Mallorca Property - With so many great towns and villages where do you choose to buy your dream Mallorca property? Both Alcudia and Pollenca in the north of the island are good towns to consider - find out why.
Water Pressure and Standard Variations What a Buyer Should Know - Homebuyers are often concerned about the water pressure at a home they plan to purchase.
Underlying Forces of the China Stock Market Bull Run - When a stock market has a sustained bull run, there are always key underlying forces driving and sustaining the index at high levels.
The Barton Creek Community Austin Texas - Fifteen minutes from downtown Austin, yet worlds away from the hustle and bustle of the city, Barton Creek offers high end living in the beautiful Hill Country of Texas.