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Definition
Franchising is a method of growing a business whereby a franchise
owner ("Franchisee") is granted, for a fee, the right to
offer, sell or distribute goods or services under a business system
determined by the business founder (Franchisor).
Further, the Franchisor supports that franchised business group by
providing leadership, guidance, training and assistance, for which
they receive ongoing service fees.
Today
Franchising
has made a significant contribution to the Australian economy by
enabling companies to grow faster, in many cases much faster, than
their own manpower and capital would otherwise have permitted.
Some franchise systems have achieved quite astonishing growth
rates.
Franchising has also given tens of thousands of people the
opportunity to start their own businesses, with an exceptionally
high probability of success.
By providing a tried and proven business system, plus the type of
support that monitors performance, quality and business standards,
the Franchisor vastly improves the chance of success for
Franchisees; who are willing to pay for that benefit.
That business success, and the natural wish of a prospective
business buyer to enjoy such, is the very key that sustains a
market share growth rate far beyond the level most businesses are
able to achieve through traditional business growth methods.
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