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Mencari Idea Businessó Mengembangkan hobi, minat , kompetensi dan
memperluas pemahaman tentangkesempatan/peluang businessó Melipat gandakan business yang sudah jalan dengan
menyebarkan gagasan dan memperluas shareó Menginvestasikan ;gagasan/patent” sebagai modaló Menemukan model Business yang siap dijalankan
Early Franchise Entrants
ó 1898 - Automobile Manufacturersó Division of responsibilities:
- manufacturers - design & production- dealers: sales & service
Coca Cola Company
ó 1886 : coca-cola inventedó 1899 : Thomas & Whitehead 600-word contract
promised to open a bottling plant• 1901 : no capital to open the bottling plant …?• 1919 : 1,000 franchised Coca-Cola bottlers
Gas Stations
ó 1930’s - Depression Era Franchisingó First example of Conversion Franchisingó Taxation of all company-owned gas stationsóWhy pay that? …. let’s FRANCHISEó Also quicker local response to price changes
Fast Food Fiftiesó Harlin Sanders - gas stationó closed pumps: 142 seat restaurantó 1950’s: turned down $164,000ó 1960 (200) 1980 (6,000) ó 2007: 13,433 KFC’s world-wide
• San Bernardino, CA 1940• Dick & Mac McDonald• inspired by Henry Ford’s assembly
line• Ray Kroc - multi-mixer salesman• world’s largest chain of FF-rest’s• over 31,000 locations world-wide
1960’s, 1970’s, 1980’s, 1990’s
Franchising Timelineó 1898 - General Motors, …Fordó 1899 - Coca-Colaó 1930 - Gas Stationsó 1952 - KFC: 13,433 ó 1955 - McDonalds: 30,823ó 1964 - 7-Eleven: 31,680ó 1974 - Subway: 26,197ó 1980 - Mail Boxes Etc. 5,760ó 1995 - Curves: 9,882ó 2001 - Geeks On Call: 305
Principles of Franchisingó 1,550 company-owned restaurantsó Revenues $1.69 billionó Expenses $1.42 billionó Pre-Tax Profit $270 million (16%)
ó 4,550 franchised restaurantsó Revenues $486 million (royalties)ó Expenses $ 78 millionó Pre-Tax Profit $408 million (84%)
Types of Franchisesó Manufacturer-Retailer (auto & gas)
= 70% of franchise salesó Manufacturer-Wholesaler (coca-cola)
= 3% of franchise salesó Business Format (McDonalds, Hilton)
= 27% of franchise salesó Franchising in the Economy (1986)
last year Dept. of Commerce collected datahow has franchising evolved since then?
Franchisor Strategiesó Advantages Of The Franchise Model
OPM expansionfranchise & royalty Feesleverage IP assetsefficient market penetration
ó Disadvantages Of The Franchise Modeldoes not solve existing problemsinitial development costsentering a new business: new expertiseprofile ‘problems”
Outline
About Franchise
The trends
Buy a franchise
Franchise agreement
Ensure franchise success
FOOD
hotel
Hospital/Clinic
Auto service
Retail
Buying a Franchise The franchisee is the buyer of a franchise.
The franchisor is the seller of a franchise.
franchisee the buyer of a franchise who is given the right to the franchisor’s product, process, or service
franchisor the seller of a franchise who is giving the buyer planning and management expertise
About franchise
A franchise is formal
permission, like a license, to use the name and products of a
company.
A franchise business is a method a
company uses to distribute its products or services through retail outlets owned
by independent, third party operators
Franchising is based on mutual trust between the
franchisor and franchisee
What is a franchise business? What is franchising?What is franchise?
About franchise
The company that grants the independent
operator the right to distribute its
trademarks, products, or techniques
The independent, third party business
person distributing the franchiser's products or services through
retail or service outlets
Product/trade name franchising
Business format franchising
Franchisee Two forms Franchiser
What is franchising?“A franchise operation is a contractual relationship between
the franchisor and franchisee in which the franchisor offersor is obliged to maintain a continuing interest in thebusiness of the franchisee in such areas as know-how andtraining; wherein the franchisee operates under a commontrade name, format and/or procedure owned or controlledby the franchisor, and in which the franchisee has or willmake a substantial capital investment in his business fromhis own resources.”
- Definition by International Franchise Association
What is franchising?ó Legal and commercial arrangement concerning the
successful business of a franchisoró Use of franchisor’s trade name, format, system
and/or procedure under licenceó Means to raise capital and expand quicklyó Assistance to franchiseeó Marketing, management, advertising, store design,
standards specificationsó Payment by franchisee by way of royalty, licensee fee
or other means
What is franchising?Franchising is more than distributorship
ó Extends to an entire operation or method of businessó Greater assistance, control and longer durationó Distributor merely re-sells products to retailers or
customers
TYPES OF FRANCHISE
ó3 main types of franchise:
ó Product distribution franchise; ó Business format franchise; andó Management franchise.
Produces the syrup concentrate
Sells the syrup concentrate
FRANCHISEE Produces the final drink
Retail Stores
Restaurants & F&B Outlets
Vending Machine
Operators
PRODUCT DISTRIBUTION FRANCHISES
BUSINESS FORMAT FRANCHISING
ó In a business format franchise, the integration ofthe business is more complete.
ó The franchisee not only distributes thefranchisor’s products and services under thefranchisor’s trade mark, but also implements thefranchisor’s format and procedure of conductingthe business.
A contractual business agreement between a manufacturer or another
supplier and a dealer to produce and market the supplier’s good or service.
What is Franchise?Franchise is a license granted by a company (the franchisor) to an individual or firm (the franchisee) to operate a retail, food, or drug outlet where the franchisee agrees to use the franchisor's name; products; services; promotions; selling, distribution, and display methods; and other company support.
How Franchising Workó An individual who purchases and runs a franchise is called
a "franchisee”.ó The franchisee purchases a franchise from the "franchisor”.ó The franchisee must follow certain rules and guidelines
already established by the franchisor, and in most cases the franchisee must pay an ongoing franchise royalty fee, as well as an up-front, one-time franchise fee to the franchisor.
“Although franchising was conceived and born in the west its future undoubtedly lies in the emerging economies of Asia.
The growth and development of franchising in the most populated and, in a franchising sense, the most undeveloped, region of the world is already well advanced.
The expansion of established international systems has alerted governments, the business community and consumers within the disparate countries within the region to the unique attributes of the business format franchise model and to its economic and commercial benefits.”*
* Prof Andrew Terry, University of New South Wales and Special Counsel, Deacons, LAWASIA Conference, 2008
A conceptual overview of franchising in Asiaó Asia has 60% of the world’s population, and 7 of the 10 most populous
countries.
ó The biggest trends are the expansion of the economic impact of franchising throughout the Asian region, and the continued preference of Government for regulatory models rather than relying on market forces or self-regulation.
ó The immaturity of business regulation and the administrative difficulty of transacting are features of many Asian countries. There is often a divergence between franchising law and franchising practice. It is not just a question of legal compliance. It is often important to win the hearts and minds of regulators as to the viability of the business concept and perhaps the commitment of the foreign entity to the market.
Population Franchise Systems Date & Source
Australia 20m 960 2006 FCA
China 1.3bn 2800 2007 CCFA
Hong Kong 7m 100 2007
India 1bn 850 2008 FAI
Indonesia 220m 185 2004 Austrade
Japan 130m 1194 2006
Malaysia 24m 318 (registered) 2007
New Zealand 4m 390 2007 FANZ
Philippines 89m 1000 2007
Singapore 4.5m 420 2007 WFC
South Korea 48m 2211 2005 Austrade
Taiwan 22m 1124 (chains) 2006 CCFA
Thailand 65m 150 2007 WFC
Vietnam 80m 70 2007 VNA
Franchise’s major growth In Indonesia
Franchise sector in Travel
Franchise trend in the Hotel business
The Trends
WHY DON’T YOU FRANCHISE?
Lower Failure Rate
Help with Start Up and Beyond
Buying Power
Star Power
Profits
Advantages
WHY DON’T YOU FRANCHISE?
Their Way or The Highway
Ongoing Costs
Ongoing Support
Cost
Shark-Infested Waters
Disadvantages
Franchise Agreement
Document
Cornerstone document of the
franchisee--franchiser
relationship
Provisions covering
The obligations of the franchiser and franchisee
regarding operating the
business
Legal advice
Get a specimen contract for a solicitor to review.
What's in a franchiseagreement?
Tips on franchiseagreements
What's a franchiseagreement?
Areas covered by a typical agreement
Fees
Term
Territory
Restrictions
Support
Exit
A typical agreement
Why to ensure your Franchise?
do certain
things to ensure
that success
Franchises are unique
maintain a good relationship with your franchisor
Protected territory is granted
find the best business location
take care of financial matters
manage your resources
And how to ensure ?
develop a marketing plan
FRANCHISEES IN SINGAPORE
ó Generally young and well educatedó 62% below 40 years oldó 57% had post-secondary educationó 32% own their own outletsó 46% occupy the outlets as tenants
PERTIMBANGKANó Penduduk bertambahó Peningkatan daya belió Fokus pada orang mudaó Mobilitas makin tingguió Peluang usaha tidak berulangó Keahlian management dan business senseó Pilih bisnis model yang tepat
SELAMAT MENGGALI INFORMASI
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