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Franchising As A Business/Career Strategy


WHY IS FRANCHISING SUCCESSFUL
  1. Marketing clout to penetrate and dominate markets.
  2. Consumers are brand driven in their purchase decisions.
  3. Consumer loyalty to a brand.
  4. Consistently applied operating system that addresses consumer needs.
  5. On going support improves the effectiveness, efficiency and profitability of each unit and the overall system.
  6. Franchisee motivation and success is driven by the joint investment of time, money and effort by the franchisor and franchisee.
Franchisees are part of a system - “partners in profit” with the franchisor, all focused on getting and keeping more and more market share.

WHY DO BUSINESSES SUCCEED AND WHY DO THEY FAIL?

A business is successful if it does two things very, very well. First it must attract new customers to use its products and services. Secondly, it must retain customers once they initially use the product or service. The first is accomplished through marketing. The second through the operating system.

Contrary to popular belief most businesses fail, not because they lack capital, but because they do not know how to attract customers and because they do not know how to design operating systems that retain them. In other words, they do not know how to correctly deploy the capital they have.

FRANCHISE VERSUS INDEPENDENT BUSINESS


FRANCHISE
INDEPENDENT

Brand name awareness Create brand name
Proven operating system Create operating system through trial and error
Ongoing support system No internal support
Proven marketing plan Develop own marketing plan
Survival rate first 5 years 75-80% Survival rate first five years 20-25%


“In Canada, franchising represents over $100 billion in sales annually and continues to grow… and directly employs more than 1.5 million Canadians. Canada also has one of the most prolific franchising sectors in the world, led only by the U.S. Approximately 76,000 individual franchise operators do business in Canada under 900 different brand names. Of all the franchises opened in Canada with the last 5 years, 86% are under the same ownership and 97% are still in business.

Canadian Franchise Statistics – Oct 2008



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