The Franchise Procedure
„In 2010 Franchising
will be the most
successful way of market expansion.“ (J. Naisbitt)
The franchise procedure strictly distinguishes between Product-1, the basic business activity respectively the basic products and/or services of a company, and Product-2/3, the business know-how (separated from Product-1), which will be integrated in a new business unit. In the example of McDonalds Product-1 represents the
"Hamburger" and Product-2 the know-how for the successful operation of a restaurant.
indicates per definition the products and/or services of a Franchisable Activity (FA). Product-2 is the business concept (for the Franchise
marketing of Product-1) which has been testet in the context of a Franchise Pilot for the Franchisee who acts on local market as an independent entrepreneur on a contractual basis given by the franchisor.
Product-3 is the business concept for the Franchise master who is an individual or a company owning the exclusive rights to develop a particular territory for the franchising company.
Whether franchising is an appropriate way for the market expansion of a company is decided, by means of an Franchise examination.
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