What is
a franchise?

The British Franchise Association provide the following explanation; "Business format franchising is the granting of a licence by one person (the franchisor) to another (the franchisee), which entitles the franchisee to own and operate their own business under the brand, systems and proven business model of the franchisor."

The franchisee also receives initial training and ongoing support, comprising all the elements necessary to establish a previously untrained person in the business. The legal contract – the Franchise Agreement – between the two parties, sets out the obligations and rights of both franchisor and franchisee and determines how long the franchise arrangement will last usually 5 years but can be longer. This will include renewal options.

Essentially, becoming a franchisee usually means that most of the risk is taken out of starting up your own business as the franchisor has a proven system which, if followed, increases the chance of success substantially. You should be provided with initial training, often called an induction course, which provides a very steep learning experience and new or experienced within the industry matters not as the knowledge gained in this period of time will steer you in the right direction.

Becoming a franchisee is not a guarantee that you will become successful but statistics suggest that the chances of you becoming successful, if you follow the franchisors systems, is greater than starting up as an independent business, no matter what industry. As few as 7% of franchisees do cease trading within the first 3 years, whereas over 90% of independent start-up businesses fail in the same time period.

A good franchise opportunity basically allows you to run your own business and benefit from the rewards of running that business, with the help, support and guidance of the franchisor and fellow franchisees.