What Is Franchising?

Franchises are generally known to the public under a well promoted name like McDonalds not the names of the individual franchise owners. As a result, the general public may not realize that many businesses are in fact franchises. 

Historical Definition 
Historically, the word franchise meant the granting of a right or privilege to an individual or group. In more recent times it includes business arrangements known as franchises, licenses, dealerships and distributorships, to name a few. 

Regulatory Definition 
Usage of a Common Name (Such as Burger King® or Subway®) 
Receives Training, Assistance, and/or Guidance (from parent company) 
Pays A Fee to the Parent Company ($500 or more within the first 6 months of operation).If a business Arrangement includes these three elements, it's a franchise. It could be called a license, distributorship, or association but it's still a franchise and must comply with the rules of the Federal Trade Commission and certain state regulatory authorities.  
 

Advantages of Franchising

Franchising is booming because consumers like to purchase goods and services from familiar names with reliable standards of service and quality. They like to deal with businesses where the owner is on-premise. 
 
Advantages to Buyers 
  • Low Risk 
  • Quicker Setup, Higher Sales, Higher Profit, and Increased Equity 
  • Be Ones Own Boss 
  • Training 
  • Support and Ongoing Assistance 
  • Collective Buying Power 
  • Regional and National Marketing 
  • System, Policies and Procedures 
  • Mutual Destiny 
  • Research and Development 
  Advantages to the Company 
  • Provides Expansion Capital 
  • Fast Growth 
  • Quality On-Site Management 
  • Fewer Day to Day Headaches 
  • Less Corporate Overhead 
  • Faster Market Penetration 
  • Higher System-Wide Sales 
  • Captive Market For Products 
  • Financial Leverage 
  • Opens Up Regional and National Account Opportunities. 
 

What We Ask of Our Franchise Members

  • Availability and an appropriate location (rented or owned), possibly in a central location. The point of sale should be equipped by you following our general guidelines, and contain a telephone, fax, and answering machine. 
  • Initial investment in proportion to the size of the point of sale.
The investment includes: 
  • Exclusive distribution and the right to use our trademark.
  • Insertion into our network.
  • National advertisement
  • Acquisition of know-how
  • Assistance in estimating costs
  • Assistance for the publicity campaigns
  • Technical-business and managerial assistance 
How to sign-up 
  • Make contact with the franchisor to make an appointment for further information.  During the appointment, all of the main subjects of the franchising relationship will be considered.  The potential franchisee will be given a copy of the contract to evaluate at his or her leisure.
 
e-mail info@tasteofitaly.com