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Franchise

Franchise . A franchise is a contractual agreement to sell a company’s products or services in a designated geographic area. . Franchisor – the person or company that offers a franchise for purchase. Franchisee – The person who purchases a franchise agreement. Franchise .

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Franchise

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  1. Franchise A franchise is a contractual agreement to sell a company’s products or services in a designated geographic area.

  2. Franchisor – the person or company that offers a franchise for purchase. Franchisee – The person who purchases a franchise agreement.

  3. Franchise To run a franchise you have to invest money and pay the franchisor an annual fee or a share of the profits. In return, the franchisor offers a well-known name and a business plan.

  4. Initial franchise fees– paid for the right to run the franchise Start up costs– includes rent, equipment, and inventory Royalty fees– weekly or monthly payments Advertising fees– television, magazine, radio, etc.

  5. Franchise Advantages 1. An advantage of opening a franchise is that it’s easy to start. 2. The name of the parent company can be a big draw for customers.

  6. 3. Equipment and supplies can be less expensive. 4. A guarantee of consistency anywhere in the country. 5. Offer training and management assistance

  7. Franchise Disadvantages • Cost a lot of money which cuts down on profits. • 2. Owners have less freedom to make decisions. Never sign a contract without an attorney.

  8. 3. Franchises are dependent on performance of other franchisee’s chains 4. The franchisor can terminate the franchise agreement.

  9. Fast Review • What are some examples of franchise businesses? • What types of assistance does the franchisor give a franchisee?

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