Franchise Business Model For Building Franchise

In order to learn how rapid business expansion growth works, you would need to understand the franchisor and franchisee business model first. Many of you who have a good business, best products, supreme quality services can start expanding their businesses even further through a well-chalked process and become a master franchisor.

A Franchisor is the one who shares its business’ proprietary tools, technology, software, manuals, trademark, signages, business processes with a franchisee for further expansion of the business. It is advised to prepare and keep a ready business manual that will help franchisors multiply their business through franchising. The returns expected from a franchisee could be through revenue share, profit, and royalty. A franchisor can benefit from rapid business expansion on the franchisees’ cost and investment without spending their own funds. A franchisee too can benefit from this method since he receives a ready blueprint of the business, including business model, operating methods, existing and ready customer base, etc.

Franchising business model has evolved in almost all industries like automobile, retail, pharma, pets, clothing, hospitality, food and drinks, education, accessories, and many more.

From a Franchisor’s point of view, there are three effective franchise business models – COCO, FOFO, and FOCO. In a COCO business model, the business is company-owned as well as company-operated. The capital and operational expenditure, both are done by the company itself. As a franchisor, it is essential for you to open a successful branch of the COCO model at the beginning of the business so that the franchisee prospective partners, themselves will come asking for a franchise. In order to attain the same, the location, manpower, profitability, footfall must be excellent.

A Franchisee owned and company-operated business model is called FOCO which means the company will carry the expense of operating the business however, the capital invest