Franchise is: Definition, Types, Types, Strengths and Weaknesses
Franchise is: Definition, Types, Types, Strengths and Weaknesses – In this discussion, we will explain about franchising. Which includes understanding, types, advantages and disadvantages of franchising with a complete and easy-to-understand discussion.
Franchise is: Definition, Types, Types, Strengths and Weaknesses
For more details, please see the review below carefully.
Definition of Franchise
Franchising or more popularly known as Franchise (French) and Franchising (English) is a right to sell a product or service or service. Another definition of franchising is a working relationship that has a contract or agreement between the franchisor and the recipient (franchise).
Often the running of a franchise business is in the form of exchanging money with an agreement or contract so that you can run the business for a certain period of time. In franchising activities, the franchisee or the owner of the franchise has the task of selling the appropriate product or service with the franchisor's stipulations, then the franchisor's or franchisor's task is to carry out business development the franchise.
Understanding Franchise According to Experts
The following is the definition of franchising according to experts.
1. Douglas J. Queen
Understanding the franchise according to Douglas J. Queen is a marketing and business expansion model. A franchisor who buys a business benefits from customer awareness of the trade names, tested systems and other services the franchisor provides.
2. Rooseno Harjowidigdo
The definition of franchising according to Rooseno Harjowidigdo is cooperation in the field of trade or services which is seen as one of the ways to develop a system business in another place, where the franchisor is economically very profitable because he gets a management fee from the franchisee, his products can be spread to other places where the franchisee seeks the franchise and for consumers who need goods produced by the franchisee quickly obtained in a fresh state and have not or not broken.
3. Dominique Voillemont
Understanding the franchise / franchise according to Dominique Voillemont is a way of doing cooperation in the field business between two or more companies, one party acts as the grandisor and the other party as franchisee.
4. Charles L. Vauhn
The definition of franchising according to Charles L. Vauhn is a form of marketing and distribution activity in which a company grants rights or privileges to do business on a certain basis in a certain time and place to relatively more individuals or companies small.
5. Government Regulation no. 42 of 2007
Definition of franchising according to Government Regulation no. 42 of 2007 is a special right that is owned by a person, individual or business entity against the business system with the characteristics of a business in the context of marketing goods and or services that have been proven successful and can be utilized and or used by parties based on an agreement franchise.
6. Indonesian Franchise Association
The definition of franchising according to the Indonesian Franchise Association is a system of distributing goods or services to end customers with franchisors who provide rights to individuals or companies to carry out business with a brand, name, system, procedure and method that has been determined previously within a certain period of time covering a certain area.
Types of Franchise According to the Criteria/Products Offered
There are several types of franchises based on the criteria, including:
-
Product Franchise
Products sold in the form of goods such as food. Examples of product franchise types include Mc Donald, KFC, Turkish Kebab, Cakekinia and so on. -
Service Franchise
This is a type of franchise that provides products in the form of services. Examples are in the field of education, photo studios or video rental services, travel and travel agent services. -
Joint Franchise
Products sold in this type of franchise are in the form of goods and services.
Types of Franchise by Origin
Meanwhile, according to the origin, the franchise is divided into two types, namely:
-
Overseas Franchise
This type of franchise is more towards being liked by the community, because this franchise has an applicable system more clearly, the company's brand has been accepted by people all over the world, besides it is also valued more prestigious. -
Domestic Franchise
This type of franchise is included in the category of investment options for people who want to become entrepreneurs quickly but do not have enough knowledge about the start and continuation of the owner's business franchise. An example of this type of franchise originating from within the country is a fast food restaurant.
Franchise Types
Some types of franchises include:
-
Trade Name Franchiseg
Trade name franchising is a type of franchise that gets the right to carry out production, for example PT. Great River has the rights to manufacture Triumph underwear under license from Germany. -
Product Distribution Franchising
Product distribution franchise is a type of franchise that gets the right to distribute in certain areas, such as soft drinks and cosmetics. -
Pure Franchising/Business Format
Pure Franchising/Business Format is a type of franchise that gets full rights, starting from trademarks, sales, equipment, operating methods, marketing strategies, technical and management assistance, quality control, and so on etc. Examples are restaurants, fast food, education, consultants, and others.
Advantages / Advantages of Franchise
The advantages of franchising are:
- The process of opening a business is faster
- Have a proven system
- Have a brand image that is widely known and proven successful
- The risk of failure is very small
Disadvantages/Disadvantages of Franchising
Meanwhile, in terms of franchise losses, namely:
- Requires paying the Franchise Fee
- Required to pay Royalty Fee
- Imposing rules of the game that must be followed
- Perform control and supervision regularly
Thus has been explained about Franchise is: Definition, Types, Types, Strengths and Weaknesses, hopefully can add to your insight and knowledge. Thank you for visiting and don't forget to read other articles.
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