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The Ins and Outs of Franchising

ANAHEIM –The West Coast Franchise Expo sought to connect national and international franchises with like-minded business professionals.

AAMCO Transmissions, Inc., Dunkin’ Donuts, and Basking Robbins were present along with less well known franchises like Louisiana-based Smoothie King and Instant Imprints, based in Ontario, Canada, which offers comprehensive marketing services from shirt embroidery to car wraps.

Collectively, franchises contribute significantly to the U.S. economy by providing, directly and indirectly, 18 million jobs, according to a study published in 2004 by PriceWaterhouseCoopers.

The International Franchise Association, which was established in 1960 to support the healthy growth of franchises during a period of franchise influx, claims there are 825,000 franchises which contribute $2.1 trillion in economic output in the United States.

BECOMING A FRANCHISEE - What is a franchisee and what does it take to buy a franchise? A franchisee is one or more people who are granted the right by a franchisor to market a product or service with an established trademark.

There are thousands of franchises in dozens of industries. Fast food, restaurants, auto, and retail are among the most common industries where franchises such as McDonald’s, Outback Steakhouse, AAMCO, and Athlete’s Foot thrive.

An initial franchise fee, which could range from $10,000- $100,000, along with ongoing royalty and advertising fees, are required to become a franchisee.

Gregory Cook from the International Franchise Association mas manning IFA’s booth at the Expo. He clarified that people don’t necessarily buy franchises – they are awarded based on an investors qualifications. In additional to meeting financial requirements, potential franchisees need to “fit the culture of the brand” he said.

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