Hotline: 1800 102 2007
Hotline: 1800 102 2007
Search Business Opportunities

Know About these Franchise Ownerships Before You Buy a Franchise

Before diving into the venture, it becomes important to know about different types of franchise ownerships so that you become aware of what rights would be given to you under which ownership. Read on...

By Features Writer
Know About these Franchise Ownerships Before You Buy a Franchise

One thing about franchising thatseems clear is that it gives the franchisors and franchisees a whole lot of advantages, but as you start exploring the vast world of franchising, it might look daunting to a beginner.

The selection of a potential franchisee is a simple process: the franchisor invites them to join in; aspirants apply to own the franchise;then interviews take place; and finally the selected franchisee is required to sign up a franchise agreement, which declares the ownership as then he/she becomes the franchisee. While everything in this process remains almost similar for every franchise business, a franchise agreement might differ from franchisor to franchisor.

Before diving into the venture, it becomes important to know about different types of franchise ownerships so that you become aware of what rights would be given to you and under which ownership. Here are the different types of franchise ownerships.

Single-Unit Franchise

In this type of franchise ownership, a franchisee has the rights to operate one franchise unit only. For most of the franchisees, this is the entry level of entering the world of franchising as the one has to handle only one unit. It is one of the best ownerships for a beginner as it provides an apt environment to gain an understanding about the franchise system.

In this type of franchise, you are given small radius of exclusive territory to operate within. Also, you are involved almost all the operations of the franchise.

Multi-Unit Franchise

In a multi-unit franchise, the franchisee acquires more than one units of the franchise. Unlike the single-unit franchise, there is no exclusive territory where the franchise must be opened. More than one store could be opened in a territory but with a difference of specific distance, say a few miles away from each other. In this type of franchise agreement, you have to look after the delegate responsibilities of individual managers and look after the entire operation. This type of franchise gives you a room to spread out your reach in a territory faster.

Area Development Franchise

Area development franchise is very similar to a multi-unit franchise in the aspect that it lets you open more than one units. But unlike multi-unit franchise, a larger geographical region is assigned to you and you are given  the responsibility of opening stores in many locations at the same time.

As long as the area development franchisee works well, they have an exclusive area where no other franchisees are allowed to open a franchise. In this type of franchise ownership, you pay a reduced franchise and royalty fees.

Master Franchise

In a master-franchise system, the franchisor gives you the right to a large geographical region in which you will be an intermediary between the individual franchisees and franchisor. This type of franchise ownership gives you some privileged rights such as reduced franchise and royalty fees, the right to sell the single-unit, multi-unit and area development franchises and many more.

As a master franchisee, you will pay a large fee to the franchisor for the region, and then you will collect the franchise fees from individual franchisees. You will look after your entire region, but you are not actually the owner of each location.

 

Comment
image
image
image
image
Related opportunities
  • Quick Service Restaurants
    About Us: This quintessential restaurant will transport you to a European..
    Locations looking for expansion Andhra pradesh
    Establishment year 2008
    Franchising Launch Date 2018
    Investment size Rs. 10lac - 20lac
    Space required 400
    Franchise Outlets -NA-
    Franchise Type Unit
    Headquater Shaikpet Andhra pradesh
  • About US:  Founded in 1919 by the Vilgrain family, Delifrance today..
    Locations looking for expansion Delhi
    Establishment year 1983
    Franchising Launch Date 2019
    Investment size Rs. 1 Cr. - 2 Cr
    Space required 1000
    Franchise Outlets -NA-
    Franchise Type Unit
    Headquater New delhi Delhi
  • About Us: Associate with the leading brand in Olympiad Examination in..
    Locations looking for expansion Delhi
    Establishment year 2014
    Franchising Launch Date 2018
    Investment size Rs. 50 K - 2lac
    Space required -NA-
    Franchise Outlets -NA-
    Franchise Type Unit
    Headquater New delhi Delhi
  • Healthcare Products
    dr batra..
    Locations looking for expansion Maharashtra
    Establishment year 2012
    Franchising Launch Date 2012
    Investment size Rs. 20lac - 30lac
    Space required -NA-
    Franchise Outlets -NA-
    Franchise Type Unit, Multiunit
    Headquater Mumbai City Maharashtra
Insta-Subscribe to
The Franchising World
Magazine
For hassle free instant subscription, just give your number and email id and our customer care agent will get in touch with you
OR Click here to Subscribe Online
Daily Updates
Submit your email address to receive the latest updates on news & host of opportunities
More Stories

Free Advice - Ask Our Experts