Quick Claim Process
Affordable Premium

Quick Claim Process
Affordable Premium
Franchising is one of the easiest and most flexible methods to grow your business and enhance its brand reputation internationally. However, people who are starting a business often suffer from a dilemma regarding choosing the right kind of franchise that fits their business needs and expectations. Thus, knowing the types of franchises can be essential here.
Are you wondering what kind of franchise will be suitable for you? Then, keep reading this article to get a comprehensive overview.
With a franchise business, you get to sell an established company's products, maintaining the company's trademark and intellectual property rights. The work pressure is low, as you do not have to manufacture your own products. The franchisor allows you to sell their products and use their intellectual properties in exchange for a royalty.
With such a business, you can generate a good profit, as you are selling the products of an existing company with a loyal customer base. However, you need to pay a part of the profit to the franchisor as compensation for using their intellectual property rights. Moreover, it is a way of growing a business faster and earning a good profit margin.
Starting a business is always scary, as its growth and success are primarily unpredictable. However, at the same time, it is the best professional choice for tremendous profitability. Here, a franchise can be the answer to your uncertainties. It is a simple and effective method of starting a new business. Here is a list of the different types of franchise to give you a better idea.
As the name suggests, such franchises are product-driven and depend on a supplier-dealer relationship. Here, the franchisee distributes the trademarked products of the parent company. However, the franchisee cannot access the entire system, as the franchisor licence its brand name.
Products
Large product dealers dealing with car spare parts, appliances, computers, vending machines, etc., typically use this franchise.
Examples
General Motors, Coca-Cola, Pepsi, Exxon, etc.
Advantages
Disadvantages
This type of franchise is also similar to a product franchise system. However, in a business-format franchise, the franchisee gets access to operate the entire business and market and not just the products. Here, the franchisee has the right to work with the franchisor's accounting, operations, quality control, promotions and training. It is one of the most popular franchise ideas.
Products
This kind of franchise is mostly seen in fast food, retailing, business services, gym and fitness, restaurants, etc.
Examples
Motel 6, Subway, RE/MAX, UPS Store, McDonald's, KFC, Chick-Fil-A, Gold’s Gym, Planet Fitness, Bath & Body Works, etc.
Advantages
Disadvantages
This is a home-based franchise business for people who are looking for a low-investment venture. Here, a single person can be the franchisee, handling the products or providing a service under a specific industry. Purchasing a minimal range of equipment and maintaining a limited stock can be sufficient for this type of franchise. Thus, paying a basic franchisee fee can be helpful for this franchise.
Products
Travel agencies, garden care, drain cleaning, cell phone accessories, real estate services, shipping services, event planning, daycare, etc., are standard franchise products.
Advantages
Disadvantages
Among different kinds of franchising businesses, this type refers to a large-scale franchising idea. Here the franchisee is a significant investor in the concerned company. The franchisee needs his/her own management team besides a large investment for maintaining the business. Such a franchise business aims to gain a significant return on investment within a short period.
Products
Hotels and big restaurants mainly come under this kind of franchise.
Examples
Holiday Inn Express, Comfort Inn, Days Inn, Tim Hortons, Taco Bell, etc.
Advantages
Disadvantages
This kind of franchise business builds a modified relationship between the franchisor and the franchisee. Here, a franchisee enters into a relationship with an existing business instead of starting the venture from scratch. First, it turns the business into a franchise unit while adopting the company's trademark. Then, the franchise starts adopting marketing and promotions, advertisements, training and client service standards.
Products
Franchisees, including real estate brokers, electricians, florists, plumbers, professional services, etc., mainly take an interest in this kind of franchise business.
Examples
Century 21, Ace Hardware, etc.
Advantages
Disadvantages
The final step is to choose an office space in a favourable location. The office space should be in tune with the business's specific requirements. Moreover, you need to hire your employees by posting vacancy advertisements in the location. You can also look for internal employees looking to relocate to your chosen location.
As you can see, even the most popular franchises have their own advantages and disadvantages. So, if you are still contemplating your choice of building a franchise business, here are some of the advantages and disadvantages of a franchise business.
Advantages of Franchise
Disadvantages of Franchise