„In 2010 Franchising
will be the most
successful way of market expansion.“ (J. Naisbitt)
What is Franchising?
Franchising is a method of doing business. It is a method of marketing a product and/or service which has been adopted and used in a wide variety of industries and businesses.
Franchising essentially describes a comprehensive relationship in which the franchisor grants to the franchisee the right to operate a business selling products and/or services produced or developed by the franchisor, under the franchisor's business format and identified by the franchisor's trademark.
Franchising as a global and fast growing market
The yearly growth rate of the franchising market is 20 % at the minimum. More than 90 % of the franchisees are successful (Gallup Institute, Princeton, N.J.).
In Europe are 20 billions of
SMEs - small to mid-sized companies; Germany 3,5 billions, Switzerland 240 000, Austria 280 000, whereof at least 10 % are franchisable.
In the United States, franchising constitutes more than 1/3 of retail sales. Franchising is growing in significance in the European Union and the rest of the world. It is likely that franchising will develop in China, India, Pakistan, Russia, South America, East Europe, and Africa.
Franchising as an ideal way to establish your own business
The word "franchise" literally means to be free. In this sense, franchising offers people the freedom to own, manage and direct their own business. However, as with any freedom, there are responsibilities. In franchising, these responsibilities have to do with the franchisee's commitments and obligations to the franchisor. The franchisor provides a method of doing business that has been tested over time in the market
place. Moreover, the franchisor provides its expertise, experience and continuous advertising and market support.
92% of all franchisees are successful
Institut, Princeton, N.J.), comparing to only 15% of the founders and entrepreneurs in new businesses. 75% of the franchisees renew the co-operation contract (IFA Washington D,C,), 30% of the total population would like to be independent (Fessel GfK, Vienna).
as a basis of the "Glocalization" - Megatrend of the new Millenium
The simultaneous co-existence of the globalisazion (worldwide market penetration) and localisazion (local market operation, know-how and acceptance) ist called "Glocalization". Successfull market strategies driven by "glocalization" are predicted to be the megatrend of the new millenium.
In this sense, franchising as an instrument for efficient market expansion is growing in significance: The franchisor represents the global and expanding factor whereas the franchisee is a market player in local territories.
as a catalyst of the
Megatrend "New Work"
Franchising supports the change of the working style and form connected with the ongoing globalization process: Strong desire for self-determination in the work, independence, continuous trend away from the employee to the entrepreneur, up to the life entrepreneur. This development
is recognized as the further megatrend of the new Millenium.
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