How franchising can help expand your business

A franchise/franchising is one way that holders of well known brands, especially in the service industry, can earn extra revenue without necessarily having to expend a large capital investment.

It’s also a means of providing entrepreneurs a stake to participate in running the business of well known brands.

It’s as simple as the franchisor allowing interested parties to use the franchisor’s business concept and techniques in exchange for a percentage of the revenues earned by the franchisee and in some cases in exchange for royalties.

Franchises have become very common internationally, with franchises even being auctioned on the net.

Kenya is catching up fast with owners of well known restaurant brands opting for franchising rather than expend large sums of money expanding.

Franchises are suitable where the business concept is unique.

For example, in the entertainment industry.

Let’s assume that there is a well known entertainment event in the UK that attracts wide viewership.

A local entrepreneur would rake in millions in profits if he bought the franchise from the original event owners and held a similar event locally.

This is the concept known as event franchising which is simply a method of duplicating public events held in other geographical areas while retaining the original mission, concept and logo.

For example, the Miss World (K) beauty pageant is most likely an event franchise from the original body.

The event has most likely been franchised in several countries globally and its concept of beauty with brains upheld.

If some other person other than the franchisee held a similar event locally then they would be liable especially for breach of intellectual property laws where the franchise is exclusive.

Buying an exclusive franchise is a good way of maintaining a wide market share within a specific geographical area.

Franchises are also good for businesses with wide geographical appeal, for example health services.