What’s a Master Franchise?

Being a master franchise ensures that the brand owner has given you the right to conduct all of the franchise’s operations in your jurisdiction. This is a really common practice among large brands, such as McDonald’s and Dairy Queen, which have numerous places that it would be ineffective for their company headquarters to oversee all of them. By designating another thing as master franchise, they pass on the job of managing individual locations in addition to that of opening up new ones.

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These responsibilities include, but are not Limited to:

  • Expanding the franchise within the designated region
  • training supervisors and employees at different locations
  • helping during the incubation period
  • checking in to make sure that every place is complying with the brand’s standards.

Having delegated business operations in a variety of areas to master franchises, the brand owner becomes what we call the master franchisor. Therefore, they oversee every master franchise in precisely the identical way that the master franchises handle the shops within their designated area. Bearing this in mind, we being to find that the pyramid structure that connects each shop to the very top. Initiatives move downward from the top, and exemptions go exactly the opposite way.

Master Franchise vs. Area Developer

Area programmer is a term that’s more or less synonymous with master franchise. Certain organizations may prefer one term over the other.

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A master franchise can be referred to as a master licensee, particularly in cases where the land they oversee is an whole country.

What Are the Benefits of Being a Franchisee?

Benefits of being a franchisee include:
  • Entry into a company network of seasoned professionals
  • A successful foundation for you to build upon
  • Becoming part of a familiar brand
  • Prior business experience not typically a must
  • Higher rate of success than independent start ups
  • Often less expensive than independent start ups
  • Investors more inclined to partake.

Let us expand on all these points.

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Entry into a thriving business network.

When you become a franchisee, you’re buying into a company network which has already figured out how to succeed. You stand to gain from this success in various ways, and the network stands to benefit too. Your success is theirs also. So, if you end up struggling or needing a solution to a specific problem, there’ll be many experienced folks that will gladly help.

An effective foundation for you to build on.

If a brand is expanding, it’s very likely they have many important things figured out: branding, target market, stock management, employee management, business engineering, budgeting, and countless others. Whereas in case you start your own company, you’ll need to build these systems while creating an excellent product and a familiar brand, by purchasing a franchise you will implement what has worked for several others.

Becoming part of an immediately recognizable brand.

This is one of the most crucial advantages of owning a franchise. The objective of every company is to create a new that people immediately recognize. When customers know what to expect, they’re more inclined to work with you. Reaching this level, however, can be quite a tough task, and a costly one when you are wholly responsible for your own marketing and advertising. However, when you become a franchisee, it is already done for you.

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No previous business experience needed.

Some brands might require franchisees to have business experience or a business degree, but generally speaking this isn’t the case. Most brands offer the training required to run the company up to their standards, and many initiatives — advertising campaigns, upgraded practices, new products and services — come from above. This way, you will learn most of everything you will need to know and the majority of the vital business decision will be made on your behalf.

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High rate of success.

Purchasing a franchise doesn’t guarantee success, but it does make it more likely. According to Entrepreneur, 85% of independent businesses fail, compared with just 10 percent of new franchise locations. Again, this makes sense when you consider that manufacturers seeking to expand have probably already figured out the formula for success. By becoming part of the formula, as opposed to trying to figure it out by yourself, you’re giving yourself a running start.

Often less expensive than starting an independent organization.

Starting a company is, needless to say, quite costly. You require a license, a rental, inventory, employees, furniture, tools, insurance, copyrights, and much more. As a franchisee, you will need all these items also, but instead of shopping around for each separately, you may purchase them via the franchisor or by way of some channel that they give you access to. Based on the brand, this may cost a significant amount, but you understand just what you will get for your money, and the buying process is, if not less expensive, certainly more efficient.

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Easier to discover investors.

Taking into account all that has been said up to now, it’s not surprising that investors are more inclined to invest in a new franchise location as opposed to into a completely new venture. Consequently, if the cost of purchasing a franchise is too high for you to pay out of pocket, then it ought to be relatively easy for you to find other people that will help you shoulder the load.

What benefits helped you out when you turned into a franchisee? Tell us in the comments!

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