Most people underestimate the power and advantage of franchising. In terms of common business models, people tend to be inclined towards affiliate marketing, the regular PPC campaigns and adverts on their sites to rake in the revenues. However, if you consider some of the strategic advantages that franchising has to offer, you might just change your perception towards it!

The concept of franchising
The central idea behind franchising is to recruit people to refer your brand to other customers. If you own a company and want to improve on its marketing and brand appeal, you can leverage the concept of franchising really well. In such a business model you enter into an agreement with a franchisee (the person who will do the marketing for you). As per this agreement, you need to supply the franchisee with marketing and promotional materials as well as provide all the necessary training needed to enhance the brand appeal. In addition, with every successful sale that happens, the franchisee will earn a commission. The percentage can be fixed based on mutual consent.

Why it can work for you
If you are an entrepreneur but shy away from starting a business because of the capital involved, then franchising is perfect for you. There are many reasons for this:

- Negligible startup costs: In a franchising business model, you do not have to spend as much as you would when starting a new business of your own.
- Training provided: The other significant advantage of franchising is that you get all the training needed to get started. Everything pertaining to product knowledge and know-how is imparted to you by the franchisor itself. Thus, you do not need to spend time in preparing about product knowledge.
- Promotional material provided: The franchisor will provide you all the promotional and publicity materials needed in your endeavor to succeed. Unlike a conventional business, where you need to prepare all promotional materials from scratch, in franchising this is not the case. You get access to all brochures, leaflets and other marketing collateral needed to sell the product/s.
- Established brand: The most significant advantage of franchising is that you are doing business with an already established brand. If you were to start your own business, it would take you quite a bit of time to break even and start being noticed by your target customers. In a franchising system, you are selling products or services from an already established brand. Thus, your work of promoting and publicizing the product is diminished significantly. Customers already know about the brand!

Who is franchising for?
Franchising is a great business model to adopt but it will only work if you have an entrepreneurial bent of mind. If you are expecting easy money to flow in, without you having to do much work, then this opportunity is not for you. Although franchising involves dealing with an established brand and you get access to training and promotional materials, you still have to do the selling part of the work. You will need to convince customers to buy the products. Hence, selling skills are essential to be able to succeed in this business.

Dos and don’ts
There are certain things that you should and should not do when adopting a franchising business model.

- Do ask questions when you have doubts about the company or product. If you are not clear about it you cannot sell well
- Do expect to bear initial expenses in setting up the necessary infrastructure to sell and promote the products
- Do utilize the promotional materials provided. These have been prepared by marketing experts and will help you garner more sales
- Do sign a contract. Hiring a lawyer is also a good idea because you are entering into a partnership in a franchising system. Make sure you understand all the clauses mentioned in the contract
- Do expect some inventory wastage. You may not be able to sell all products within the timeframe specified. You may not get the commission and may just be left with excess products in your inventory
- Do not sign the contract until you understand all the clauses clearly
- Do not opt for franchising if you are not passionate about starting and running your own business

Just like any other business model, franchising is also fraught with risks. The bottom line is to persevere, follow the methodologies outlined in the training sessions and expect to lose a bit of money at the beginning. Once you break even the sky is the limit!