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Franchising is a means of marketing and distributing goods. The franchisor, normally a large business, supplies the franchisee. Usually an individual, with products of service for sale to the public. The franchisee pays for the right to sell the product or service in a certain area, and also makes annual payments known as royalties to the franchising company.
This type of business has always been popular in the USA. It developed particularly in the 1890 until 2010 when there was a boom in fast food restaurants such Mc Donald and Pizza Hut. now about one- third of all retail sales in the US are through franchised outlets,and there are about 500,000 enterprise operating in this manner.
The system is spreading quickly throught the world. In America companies using franchising include: fast food, Susshi, and Seadood
It is not surprising that franchising is growing fast.if it works property, it has advantages for both sides. The franchisor is able to expand his business without reducing his capital or borrowing money. In fact he gets additional capital from an will probably be hard working. This is important, especially in fast food outlets where the hours of opening are long.
The franchising system gives people the chance to set up in business without taking great risks. If they choose their franchise wisely, they will have the opportunity to make a small fortune.
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