In addition to economic contribution, Franchising also facilitates the transfer of skills and knowledge. South Africa has over 700 Franchise Systems, 80% of these are home grown, i.e. South African brands. There are more than 33 000 franchise outlets operating in 17 Sectors.
A franchise is an agreement or license entered into by two parties, the franchisor and the franchisee.
A franchise gives a person or group of people - the franchisee - the rights to market a product or service using the trademark of another business (the franchisor).
Before deciding whether to Franchise your business, the following need to be considered:
Credibility and a proven concept: The concept needs to be proven. The business must have a good track record and an experienced management team.
Profitability: The franchisee and franchisor should obtain a reasonable profit. The franchisor should receive a return on the investment in the development costs. The franchisee should receive a return on the investment in setting up an individual outlet.
Uniqueness: The business to be franchised needs to have a unique selling point that will allow it to differentiate its products or services from those of its competitors.
Sustainable and growing demand: The franchisor needs to ensure that demand exists in different areas, and that the product has staying power. The market for the product or service should be growing and the demand must be sustainable.
Intellectual property and systems: The business needs to have a set of systems, procedures, expertise, skills and know-how that optimises every operational step.
Transfer of skills: It must be possible to train prospective franchisees lacking experience in the sector within a reasonable period.
Support infrastructure must be in place: The franchisor must provide intensive initial and ongoing support to franchisees. This requires manpower, facilities, a veritable set of skills and absolute dedication to the creation of win/win outcomes.
Potential franchisees should consider the following before committing to an opportunity:
What we offer?
Application for finance checklist:
Additional supporting documentation:
Call us on 011 344 5438
Email us on: firstname.lastname@example.org