In simple terms, franchising refers to the distribution of products and services. This might seem to be a bit confusing for most people as the traditional distribution of products and services is not referred to as franchising now, is it? To explain further, it is the distribution of a company products and services through a different company that adopts the name of the original company, the one owning the goods and services. It would be interesting to note that this is one business approach that is highly being adopted in the business world of today. Many businessmen are opting to be franchisors and franchisees.
Statistics show that this approach has been really growing and it is highly contributing the creation of new employment opportunities in the job market. For instance, in the United States alone, franchising has resulted in the creation of 184,000 jobs over a period of twelve months. It is definitely a good approach to business as it is creating a win-win situation. The current expectation is that the franchise sector will continue to grow and that it will exhibit a growth rate that will be twice that of other sectors in the economy.
The word franchise is mostly associated with a large number of the fast food joints like the Nandos franchise. However, it is not only the fast food joints that use this franchising business approach. As a matter of fact over 75 industries make use of this franchising format; this is according to the International Franchising Association (IFA). The association’s network and membership includes approximately 350 suppliers, 1000 franchisors and over 7000 franchisees. This is how big the franchising approach is in the business world.
The IFA reports that currently in the market are a number of new franchising trends that are coming up. These include the internationalization of franchises. This simply refers to the choice by franchisors to go international; a good example being the Nandos franchise. Another remarkable trend is the increased number of minorities and women who are engaging in franchising and the increased adoption of the most recent forms of technology.
A large number of the franchisors make use of eth internet to communicate with their franchisees all over the world. This has been shown to be one of the critical factors contributing to the success of franchises all over the world. The internet is also used as a medium to share expertise and information and to also communicate with customers and create awareness.