Franchise Systems Definition

Franchise, some people know but not well-know and some have heard about it but not much know about it. So, we will talk about this business system. Franchise systems are the protocols and processes that a franchiser makes available to franchisees as part of their franchising agreement. According to Scott Shane of the Sloan School of Management in Massachussetts, franchise systems are most successful when they make economical use of an organization's resources. In other words, franchising systems should enable a franchisee to operate his company cost effectively.

Value of Franchise Systems

o     An entrepreneur starting a business from scratch must develop company systems through a process of trial and error, although his personal and professional experience can give him a head start in learning what works. A franchisee pays for systems that the franchiser has already developed, sparing himself the time and expense of making costly, frustrating mistakes.

Marketing Systems

o     Franchise marketing systems are time-tested ways to promote the franchise system and bring in new customers. A responsible and competent franchiser will collect data about the cost and the effectiveness of different marketing strategies, developing sophisticated, cost effective systems for promoting the business concept through conventional media as well as unconventional approaches.

Personnel Systems

o     A successful franchise will include systems that a franchisee can implement \to use personnel in the most cost effective manner. These systems should be compiled in an employee manual that includes job descriptions for different positions as well as guidelines for management to use when scheduling employees and delegating tasks.

Location

o     Retail franchises include systems that address advantageous locations for opening storefront locations. Although every location has its idiosyncrasies and its quirks, successful locations tend to have commonalities, such as heavy foot traffic or ample parking. In addition to developing strategies for identifying potentially suitable locations, a franchise system should include a process for determining appropriate distances between franchise stores, such as distance or neighborhood population.

Advantages of Systems for Franchisers

o     Franchise systems help a franchisee develop a successful business, but they also help a franchiser to achieve success in the industry. A franchise with smooth, sophisticated systems that consistently turn a profit will help a franchiser to develop a reputation as a good prospect and quality investment, making his enterprise more appealing to other potential franchisees.

But to me the most important thing in the franchise system is there are day-to-day format of business, where the management of the business use it to ensure the flow are well and the customer treat are proper. It mean the businesses do not need the high education employees or experience workers to work and the cost of labor can be reduce and the earning of the business and be increase. That the business all about make a sell and reduce cost, increase profit.  

And if you not blind you can see the picture above had told you every thing about franchise system. I really hope from that picture you can get the picture of franchise system clearly and think it as a businessman and not a worker.