|
Below, you'll find extensive information on leading
franchising articles and products to help you on your way
to success.
Buying A Franchise- What Every Entrepreneur Needs To Know.
By Howard Schwartz, Wed Dec 7th
The concept of is a couple of centuries old. Thefranchising business and world economies have developedsimultaneously. The term ‘franchise’ comes from old French whereit meant freedom, or privilege. goes back to thefeudal times when the feudal lords granted permission to theirslaves and common men to hold fairs, markets, ferries, and evenallowed hunting on their lands. In the middle ages, kings used the concept of whenthey gave contracts, or franchises for most of the commercialactivities like developing roads, wells, and brewing ale. As the concept of developed further, it was seen asthe right to monopoly that a person got to perform any kind of acommercial activity. As time passed, several franchises became apart of the European Common Law.
Singer Sewing Machine Company is considered to be the fatherfigure of as most of the concepts of franchisingdeveloped by them, form a part of modern day franchisingcontracts. The way in which Singer made its sales and provided services isconsidered to be modern retailing that is a part of franchising.In the 1850s, Singer brought together teams of salesmen anddealers who were given the rights to distribute sewing machinesin different regions. They made written contracts forfranchising, which are the basis of modern-day franchiseagreements. At this point in time was seen as the right grantedby the manufacturer to sell and distribute products and serviceto the franchisee. Big oil refineries, automobile manufacturers,and many others also started following the concept of signingwritten agreements for franchisee distribution. Proper business format came into being, in theUnited
States and other countries of the world, after World WarII. This was the time when soldiers returned from the war to beback with their families and the baby boom took place because ofwhich different and newer products and services became essential. This was when the concept of developed the most. Itmade its presence felt in the U.S. economy. This was also thetime when most of the hotels and motels developed. With theincrease in the number of franchises, the 60s and 70s saw a timewhen every second person was into the business. The decades of 60s and 70s also brought about a number of fraudsin the business. There were people who duped manyothers by taking money from them in return for a franchisee thatdid not exist and escaped with the money. On the other handthere were also many franchise businesses that went bankrupt.This was when the need for strict regulations for franchisingbusiness was given a thought. In the year 1978, the Federal Trade Commission ordered that allthe franchisers/manufacturers were supposed to submit theUniform Offering Circular or UFOC before receiving money fromthe prospective franchisers. The UFOC provides the details ofthe franchise company, gives their history, audited financialstatements, information of the officers, and the contract, orthe franchise agreement. At present, the is seen as the most lucrativebusiness option for many people who aspire to own a business. Learn more about owning your own franchise business: http://www.franchise-business.biz About the author:Howard Schwartz is a partner in several business strategygroups, including HJ Ventures International, Inc. For moreinformation visit: http://www.franchise-business.biz
|
