What is franchise?

Question

I searched about edhcational consulting and found that some Indian consulting agencies give franchises to investors to create their consulting agencies. Is it a good solution?

Answer 1

As long as the agency is legit, that would be a good idea.

Disadvantages of buying a franchise. Buying a franchise means entering into a formal agreement with your franchisor. Franchise agreements dictate how you run the business, so there may be little room for creativity. There are usually restrictions on where you operate, the products you sell and the suppliers you use.

https://www.business.qld.gov.au/starting-business/buying-business/buying-franchise/advantages-disadvantages

https://www.forbes.com/sites/jaredhecht/2019/02/27/the-pros-and-cons-of-buying-a-franchise/

Answer 2

It can be!

Franchising is based on a marketing concept which can be adopted by an organization as a strategy for business expansion. Where implemented, a franchisor licenses its know-how, procedures, intellectual property, use of its business model, brand, and rights to sell its branded products and services to a franchisee.

Answer 3

Hello Kninjanin,

I don't know much about franchises, as I have not done it myself. I looked at your responses from Hitman and Rooster, and don't really know of anything else to add. 

So just to emphasize what Rooster and Hitman have mentioned, with a franchise your business will have the support of an established chain of businesses like yours, and help through advertising and name recognition. 

However, it can be costly to buy into a franchise, and you lose much of your freedom to make your own decisions. 

Answer 4

I think it would be very important to learn about the source of the franchise. Are they legitimate, or are they a scam to take your money?

If they are legitimate, then you would have to consider whether you would be able to conduct the business in a profitable way.