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What are the advantages to Franchising?

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The advantages of Franchising are many and specific to meet the needs of individuals with little income but big, business dreams. Franchising offers these individuals, soon to be franchisees, the advantage of setting up a new business in a short amount of time with an already successful and popular brand name and method of operation instead of having to start a new business all on the franchisee�s own pocketbook and resources/time in a rather hostile market to new, competitive businesses.

The advantages of Franchising for the franchisors is just as beneficial as the franchisor is able to expand their brand name over many and various regions in a relatively short amount of time while experiencing record profit growth without having to do a great deal of hard work involving customer relations, customer service and can manage the franchised business�s network. Also, the franchisor does not have to commit a great deal of finances or amount of the business�s resources to each individual franchise.

With both of these aspects combined, Franchising can be seen as a means of fighting a hostile, modern market where slow growth is no longer a plausible means of expanding a business as chain-stores and franchises as a whole dominate the marketplace in all regions and areas of product development and distribution. Slow growth is especially at risk to better-known, already established competitors who can often offer more products or deals to the customer than a just-started business. Also, many consumers will not go out of or away from a known product or business as the customer has already established a relationship of trust and reliability with that product or business.

Another advantage is that the franchisee puts himself or herself at a lower risk for legal and management risks that come with creating or starting up a business. This, invariably, grants the franchisee with a tremendous amount of purchasing power since the franchisor has already setup and made successful the business. Thus, the franchisee can focus on the purchasing of essential and business-assisting supplies and services required.

Another advantage for the franchisor is that all franchisees can be held, legally and otherwise, accountable to the franchisor�s method of operation and business style/demands.

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