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ABOUT MASTER FRANCHISEE !!!
A master franchise allows individuals or corporations to buy the rights to sub-franchise within a specific territory. Even though the initial franchise fees are higher, a master franchise license can lead to greater growth than a traditional franchise. In turn, the master franchisee keeps a good portion of the initial fees and royalties that the individual franchisees pay over time. Franchise companies generally communicate with their franchisees directly or through a master
Franchisee, A master franchise allows the franchise company to expand in a specific territory, often a major market or in one or more states.
A master franchise essentially runs two separate businesses — one operating a single franchise and the other expanding the franchise company. Each requires different skills and, generally, the companies are set up separately. For both, having sales and management experience is a definite plus for a prospective master franchisee.
Here are some points to consider before making your final decision:
Know your responsibilities. A master franchisee is generally responsible for recruiting individual franchisees.
As a master franchise owner, you're also responsible for providing support and training on an as-needed basis.
Do your research. As a master franchise buyer, it's important for you to understand two entities: the franchise
company and the master organization. Make sure, for instance, that the franchise system is based on a solid
business model. Without a viable business model, it's unlikely that a master franchise could succeed. You will
also need to research the market and territory demographics. Make sure that the territory has a population that can
support your projected sales.
Take a road trip. Your intelligence gathering should include actual visits to as many franchise locations as
possible. If you detect any problems, cross this franchise off your list. Don't be tempted to rationalize red flags.
If you sense trouble, regroup and consider another franchise system
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Look for the right match. Even if the business model is solid, you'll want to make certain that the franchise suits
your investment limitations and your goals. If you don't have the capital, then it's not a good match. If you're not
interested in the business, then it's not a good match. Be prepared to walk away if the opportunity doesn't feel
right.
Pick one approach. Becoming a master franchiser versus buying one franchise isn't necessarily a better or
smarter business move. What's important is that you choose either approach for the right reasons and with careful
consideration. Running a master franchise requires a different set of skills than owning one franchise. The skills
for building strong sales, for instance, are not the same as those needed to operate the business successfully.
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