Joint-venture - Following on from the above method of international franchising is when the franchisor establishes a joint-venture company with a foreign partner (or company) that will develop the franchise network in the target market. This is a cheaper option than the subsidiary method and is useful for large, and, or distant markets. Benefits of a joint-venture include having a local partner with direct market knowledge, and the diversification of risk and financial burdens (for example, opening of company-owned pilot sites). But of course, this also means the gains will be divided.
- The final way we will look at international franchising is when the franchisor transfers responsibilities to a local regional representative. This could be the first franchisee in the target market, of if there are a few - the biggest or marquee franchise. The cooperation with individual franchisees is on the basis of direct franchising. Business development may take a bit longer, however this method of international franchising only requires a small investment, as the regional representative receives a commission of the franchise fees taken by the franchisor.
Research - If it sounds too good to be true, it probably is! We recommend, as with any new business, to do your homework and research. Just as the company will investigate and analyse if you are the right master franchisee, you must also research to see if the company is the right place for your investment.
- Don’t just assume because a company has worked successfully in one continent that it will automatically be successful in another. You must conduct in-depth market research looking into different demographics and even cultural norms.
Then consider if you have the resources, but most importantly, the dedication to make it work - as international franchising is often more expensive from an investment point of view. - Then consider if you have the resources, but most importantly, the dedication to make it work - as international franchising is often more expensive from an investment point of view.
- When training future franchisors, we ask them if they just want to sell their franchise abroad or actually develop it themselves. If they choose the first option and want to cash the business, master franchise is more common option. If a franchisor wants to develop their brand it will involve patience and higher investment – but as with big bets, they can pay off bigger in the long run.
- Whether you’re a franchisee with 3 locations or 100 — or part of a franchise’s corporate marketing team — creating consistent marketing across your entire operation can be…challenging.
- Direct mail is no different: It can be an incredibly effective tool for many franchise industries, but managing multiple locations or service areas has serious headache potential.
- But when you partner with The Mailworks, you’re linking up with direct mail experts — and getting access to proven processes and tools that make direct mail for multi-location franchise operations a breeze.
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