1. WHAT OPTIONS
EXIST FOR
STARTING UP A
BUSINESS?

2. LEARNING OBJECTIVES
The principles of franchising as it
applies to small business start-ups
The advantages and disadvantages
of using a franchise as a means of
starting a new business; assess
franchising against other business
start-up options
How to identify a suitable start-up
location

3. FRANCHISE – WHAT IS IT?
 A franchise is the right given by one business to other
businesses to sell goods or services using its name.
People who buy into the franchise remain as independent
businesses. Examples include:

4. FRANCHISOR
The business that gives the right for others to
sell their products and/or service. E.g.
McDonalds, Subway
What’s in it for the franchise owner?
Enables a firm to expand its sales quickly
They receive a share of the sales
Burger King receives 5% of all sales.
You can work on developing more
successful products

5. FRANCHISEE
People or persons that agree to manufacture,
distribute or provide a branded produce, through a
license from the franchisor.
Why do it? What do you get?
Access to goods An established brand name
and services
Equipment
Advertising
and promotion Training
Ongoing
support

6. Using your card sort, decide
whether you card is a ad or
FRANCHISES disadvantage and create a
table to show it
Advantages Disadvantages

7. FRANCHISES
Advantages Disadvantages
 Brand already known  Less control as must do
what the franchisor
 Customers already buying
wants
product
 Must pay royalties to
 Less risk during start-up
franchisor
 Training & support
 Cannot introduce new
provided
products without
 Keep most of the profits agreement from
franchisor

9. IDENTIFYING A SUITABLE START-UP
LOCATION
 Which town / city?
 Which part of the city?
 What do you want to be close to?
 Is it the right match between shop size and cost?
 Is this the right place for your business?
 Who used this area? Who would be your
customers?
 Socio-economic / approximate social grade
http://www.censusprofiler.org/

10. WHAT FRANCHISE WOULD BE
SUCCESSFUL HERE?

11. Habits and needs of
the customers in the
area
The cost of the lease and
Practical requirements
fitting the property
such as floor space

12. HOW TO IDENTIFY A SUITABLE
START UP LOCATION
 Divide a full page into 4 equal sections
 Using p35-36
 Explain the 4 steps you go through to decide upon an adequate
location for your franchise

13. FRANCHISES
 The UK Franchise
 Homework
 Naked Pizza