Chain franchise concept

Chain operation refers to an operation that adheres to a consumer-centered approach and maximizes customer needs through unified products, unified prices, unified services, and extensive distribution in a timely manner. Way.

The three S principles of chain operations:

1. Simplification

2. Specialization

3 .Standardization.

Chain operations include three types: direct chain (Regular Chain (RC)), voluntary chain (Voluntary Chain (VC)), and franchise chain (Franchise Chain (FC)).

"Chain franchise" refers to the conclusion of a contract between the franchise head office and the franchisee, and the franchise head office authorizes the trademark, merchandise, and business technology to the franchisee. When franchisees obtain the above rights, they must pay a certain amount to the franchise head office and use the same trademark, all or part of the same goods, services and business technologies according to the guidance, training and assistance of the franchise head office. A management team with professional division of labor and centralized management. At the same time, most (or all) of the funds required for the establishment of a franchise store are borne by the franchisee, and the personnel required for the franchise store are in principle the responsibility of the franchisee. It has the characteristics of "ten unifications": unified leadership, unified trade name, unified purchase, unified price, unified clothing decoration, unified advertising, unified business form, unified warehousing and transportation, unified after-sales service, and unified management system.

The charm of "chain franchise"

1. For franchise stores: the headquarters provides a complete set of business models, personnel training, trademarks and goodwill, advertising and product supply, reducing time with capital costs and quickly increased and expanded its popularity. The headquarters is responsible for grasping consumer trends and developing new products. It can quickly grasp industry information and sales information, reduce risks, and thus greatly improve the success rate of entrepreneurship.

2. For the headquarters: Help young entrepreneurs realize their career ideals, and have more and faster opportunities to expand their business while reducing funds and manpower to develop markets.

3. For consumers: provide goods and services with standardized quality and popular prices.

Franchise chain operation means that the franchisor grants its own trademarks (including service marks), trade names, products, patents and proprietary technologies, business models, etc. to franchisees in the form of a business contract. The licensor shall engage in business activities under the unified business model of the licensor in accordance with the provisions of the contract and pay fees to the licensor.

The licensor refers to the person who provides trademarks, trade names, products, patents and proprietary technologies, and business models. Franchisees, also known as licensees, refer to those who have obtained the right to use the licensor's trademarks, trade names, products, patents and proprietary technologies, and business models.

Franchise chain operation has many advantages compared with single operation:

1. High success rate

Chain operation has been proven to be effective around the world. Effective, more than 90% of customers have achieved varying degrees of success after joining the chain system. Because chain operations not only reduce procurement costs, sales costs, and management costs, but also improve the company's brand image and reputation, and reduce competitive risks, it has also achieved a high success rate.

2. Short learning curve

Successful business model. Franchisees can learn successful business management experience and knowledge in a short period of time and at a low cost, which can save them a lot of detours.

3. Brand advantage

Franchisees can share the famous brand and reputation formed by the franchisor through long-term operating efforts at a relatively small cost, thereby effectively promoting sales and greatly expanding themselves. business scope.

4. Advantages of scaled procurement

Unified procurement can enable chain enterprises to enjoy discounts on large-volume purchases, strengthen cooperation with suppliers, expand procurement scale, and improve payment and sales efficiency. Speed, reduce procurement costs, can greatly save procurement expenses.

5. Unique advertising and promotion

Chain business enterprises can concentrate resources on advertising and promotion, reduce the average cost of advertising and promotion, and help chain enterprises establish their brand image.

6. Professional management improvement

Authorizers can help franchisees improve their management by exporting their own successful industry operating experience and management models.

7. Training

Franchisees will often receive targeted training and guidance from the authorizer to continuously improve their business and management capabilities.

8. Service support

Franchisees can enjoy the comprehensive services provided by the franchisor at a very small cost, such as logistics distribution and after-sales service, while the chain operation system enables The service is more professional.

The concept of franchising

1. The concept of franchising

Franchising (chain) is probably the most popular word in today's business world. Companies that carry out franchise business are also found in every corner of various industries. So, what is franchising? What are the benefits of franchising? Why is franchising successful? If you don't understand these issues, you won't be able to do a good job in franchise business.

1. International Franchise Association’s explanation of franchising

Franchising is a contractual relationship between the franchisor and the franchisee. According to the contract, the franchisor provides a unique business franchise to the franchisee and provides guidance and assistance in personnel training, organizational structure, business management, product procurement, etc. The franchisee pays the franchisor corresponding fees. Generally speaking, franchising is a business model for the franchisor to expand its business and sell goods and services.

2. Characteristics of franchising

(1) Franchising uses its own brand, proprietary technology, business management model, etc. to expand its business scale by combining it with other people’s capital. A business model. For the franchisor, franchising is the expansion of technology and brand value, the cloning of the business model rather than the expansion of capital.

(2) Franchising is a win-win business model. Franchising can only continue if the franchisor can achieve more efficient development than if he operated alone, and if the franchisee could obtain more benefits than if he operated alone.

(3) Franchise is an intelligent business organization form. Franchising enables franchisees to fully combine and utilize their own advantages and absorb a wide range of social resources to the greatest extent, while franchisees reduce entrepreneurial risks and costs such as time and capital.

In short, franchising is a new trend in store opening and entrepreneurship in the 21st century. It is a new driving force for future social and economic development. It will bring new entrepreneurial opportunities and profit prospects to many entrepreneurs.

2. The success rate of franchise operations

A Gallup survey from September to October 1997 showed that more than 90% of franchisees said that their franchises could be considered successful. Or very successful. Among them, 18% exceeded expectations, 48% met expectations to a large extent, and 24% basically met expectations. Two-thirds of those surveyed believe that if they had started the same industry alone, they would not have achieved such success. Almost 2/3 said they would buy or invest in the same franchise if given the opportunity again. Practical surveys have proven that the success rate of joining a business is 95.5%, while the success rate of starting a business alone is 4.5%.

3. Advantages of franchising

1. Since the brands, trademarks, and management technologies owned by the headquarters can be directly used, compared with starting your own business, you will save time and money in terms of time and money compared to starting your own business. It reduces a lot of financial and mental burdens. For people with no business experience at all, they can enter the industry in a relatively short period of time.

2. An excellent headquarters, in order to improve the goodwill of the entire chain enterprise, will always develop original and high value-added products to lead competitors with product differentiation. Franchise stores do not need to develop their own products. department.

3. Since the headquarters coordinates and handles promotions, purchases, and even accounting affairs, franchise stores can concentrate on sales without any distractions.

4. Since franchise stores have inherited the goodwill of the chain system, they give customers reassurance. They will feel familiar with newly opened stores or unfamiliar stores, and even new immigrants will join. Problems such as language barriers and living habits that shop owners worry about can all be protected under the same sign.

5. If you start your own business, there may be various difficulties in purchasing goods and raw materials. However, for franchise stores, due to the large-scale production and customization of the headquarters, even equipment, dining tables, chairs, miscellaneous equipment, etc. , can be purchased cheaply.

6. Pre-employment training and other work before the opening can be assisted by the headquarters. After the opening, there will be people to provide various guidance regularly.

7. If you start your own business, if competitors appear, you will have to fight alone to deal with it. Franchise stores have the backing of the headquarters to provide support;

8. If you start your own business, you must do it yourself. When deciding where to open a store, you often have no confidence in the quality of the location; for a franchise store, you can consult with the headquarters to evaluate site conditions, and even the head office can help with site selection.

9. Since the headquarters conducts market research on the surrounding environment at any time, including changes in customer structure and consumption tendencies, franchise stores can take corresponding measures as early as possible.

10. The success of the franchise store is the success of the headquarters, which also means helping the headquarters expand the market. Therefore, the headquarters also has a reward system and benefits for franchise stores with good performance

Open a franchise What should the store pay attention to?

1. What are the necessary conditions for joining?

2. How much start-up capital is required?

3. How many franchise stores does the company have now and their turnover? Approximately how many can there be in a year?

4. How long is the contract period?

5. If after we join, the sales situation is not good and we want to quit, what will your company do?

6. What assistance will your company provide after opening?

7. If there are promotional activities, can franchisees be given appropriate compensation?

8. Is there any rebate if the sales reaches a certain level?

9. Do I need to go to your company to sign the contract in person when joining? What documents are required?

10. What is the price of your company’s spring, summer, autumn and winter products?

11. What is the discount for picking up goods?

12. Which age group is it suitable for?

13. How much is the down payment? Is replenishment guaranteed?

14. How many goods must be picked up every month in the future? If there are any leftovers, can I exchange them for new ones?

15. How does the company provide pre-sales, sales and after-sales services?

16. What measures can be taken to make franchisees profitable?

17. How does the company provide timely supply of goods? How many days does it usually take for the goods to arrive?

18. Can I choose the clothes myself when purchasing the goods, or will the company distribute the goods?

19. If I choose the goods myself, are there samples or pictures? How many pieces of the same goods should be taken at least? Do you want to go to the local area to promote it yourself?

20. How many trade fairs are held a year? When will new models be released each season?

21. How to calculate the freight of goods?

22. Should I choose seasonal clothing by myself or by the company?

Six things to note when joining a chain store

The biggest advantage of a chain store is that it can directly borrow the headquarters’ brand name and draw on the headquarters’ experience, thereby reducing investment and operating risks. However, for franchisees, after "copying" the environment, atmosphere and products of the headquarters business premises, it does not mean that they can sit back and relax.

In the operation process, franchisees will definitely be involved in many factors such as financial management, personnel management, market development, peer competition, etc., and each franchise store will be affected by local customs, the market in which it is located, the competitive environment, etc. Different, very different from the headquarters. Based on continuous research and analysis, the UK-China Entrepreneurship Laboratory has concluded that in order to make stable profits, franchisees must absorb the headquarters' business philosophy, operating methods, etc. into their own available methods and cultivate their own management capabilities.

In other words, choosing to join requires not only the franchisee to invest a certain amount of money, but also a lot of time and energy. After all, the shopping mall is like a battlefield, and any mistake may cause your investment to be wasted.

1. In the early stage of joining, attention should be paid to reasonable raising of funds and reasonable investment of funds

Due to the eagerness to start a business and open a store, some franchisees are scrounging everywhere in order to raise franchise fees, deposits, etc. They even resorted to borrowing money at high interest rates. Once the store was opened, although the business went smoothly, in order to raise money to pay off debts every day, I had no intention of investing in the business. Once the operator who is supposed to be the leader leaves the front line due to capital allocation, other employees in the store will be immediately affected, and the service quality will gradually decline. And customers are also sensitive and will gradually stay away from the store. Of course, the performance cannot be improved anymore. Stores that were originally doing well often collapse because of this.

In order to raise franchise fees and opening expenses, Mr. Feng borrowed money from people everywhere. After successfully joining the franchise and opening the store, the business was very prosperous. Seeing that it was profitable, a creditor proposed to invest the 100,000 yuan lent to Mr. Feng to participate in the management of the hotel and the distribution of profits. If he did not agree, he would repay the debt immediately. In order to raise money to pay off debts, Mr. Feng had no intention of investing in hotel management, and the service quality gradually declined.

Therefore, Yingzhong Entrepreneurship Lab believes that franchisees should act according to their ability and choose a franchise fee that suits their own threshold. Otherwise, they will be in debt and worry all day long, which will have a great impact on the operation of the store.

At the same time, franchisees must determine a reasonable allocation ratio of the entire capital investment and make an overall plan. Don't wait until after the grand opening to find out that you have no funds for the later operations of the store. Wouldn't it be a huge joke?

2. Control operating costs and plan purchase strategies

Cost control in the operating process is very important. One less expenditure equals one more profit. Compress costs to a smaller level. A low range is absolutely necessary. However, excessive saving is also incorrect. For example, lighting effects are an indispensable condition for attracting customers for the sale of certain goods. If the spotlights are turned off in order to save power, the gain will definitely outweigh the loss.

At the same time, planning the purchase strategy and adjusting the turnover speed are also effective ways to control costs. Stores should try their best to avoid stocking up on goods. Many new owners often have serious capital constraints, and their capital operations are stretched thin, and they quickly fall into trouble. Seasonal slow-moving goods should be cleared at a timely price reduction and new goods should be used to fill the original vacancies. After all, money only comes from selling goods.

3. Learn to manage employees

Although after joining, the headquarters will provide a series of training on employee management and provide corresponding support to franchisees, but Yuanshui cannot save it. Near fire, franchisees need to find the problem from the source, truly understand it, and learn how to manage employees. The UK-China Entrepreneurship Lab found from multiple examples of entrepreneurs that many new bosses do not correctly understand this problem and start from conventional thinking and do things according to their own temperament. Therefore, it is not surprising that internal employees cause trouble.

“When I first came into contact with franchise chains, I thought that as long as I joined successfully, I could easily enjoy the success.” Ms. Wu, who once joined a beauty chain, said with emotion. Ms. Wu believes that it would be fine if she just lays down and does nothing, and everything is managed by the headquarters. After the actual opening, problems from employees came one after another. An employee of the company took advantage of his job to promote other beauty products to customers; within a week, several key employees of the company were poached by other beauty salons, taking away dozens of regular customers. Ms. Wu recruited new troops, and not long after, she discovered that she was making a wedding dress for someone else.

Therefore, franchisees must realize that managing employees is their own business, and it is something that must be done well. First of all, franchisees must fully understand their employees. As a manager, it is not easy to fully understand your employees. But if managers can fully understand their employees, their work will go much more smoothly. "A ruler is short, an inch is strong." Every employee has his or her own strengths and weaknesses in terms of ability, character, attitude, knowledge, cultivation, etc. Some work quickly, some are cautious, and some are good at dealing with people. relationship, some people like to bury themselves in statistics and work silently. As the saying goes, "A man who knows his friends will die". A manager who can fully understand his employees will be a first-class manager in terms of work efficiency and interpersonal relationships.

Secondly, communicate more with employees and listen to their voices. Employees will always have their own dissatisfaction and opinions, although some of them are correct and some are incorrect. But if it doesn't get an outlet or guidance, it can cause big problems. Therefore, managers need to communicate with employees frequently, seek their opinions, and listen to their questions. By untying the knot among employees, the team will be more united and more motivated to work.

At the same time, employees should be allowed to make mistakes and employees who perform well should be praised in real time. The real world is full of uncertainties. In such an environment, it is naturally impossible to succeed in everything. As a manager, if you require your subordinates not to make any mistakes, it will inhibit the spirit of innovation and make them timid at work. Of course, employees who have made contributions must be rewarded and praised in a timely manner to boost morale.

Learn to manage customers and establish good customer relationships

A grain of wheat has three fates: one is to be ground into flour and consumed by people to realize its own value; Seeds, after sowing, will produce new wheat grains and create new value; third, due to poor storage, they will become moldy and deteriorate, losing their value. In other words, if wheat is managed well, it will create value for mankind; if it is not managed well, it will lose its value or even bring negative value. The same is true for customers. If the franchise store is managed well, customers will become loyal consumers; if the franchise store is not managed well, a large number of customers will be lost and affect other customers.

The UK-China Entrepreneurship Lab reminds franchise entrepreneurs that they should learn to manage customer files, retain old customers, and discover new customers. Customer files include the customer's basic information, transaction status, credit ability, etc. This is also important information for franchisees to manage and track. By carefully analyzing customer profiles, you will discover their preferences, vision, and purchasing power, so that you can recommend products and provide services to them in a more targeted manner.

The cost of developing a new customer is 6 times that of developing an old customer, so retaining old customers is the basis for the survival of a franchise store. Providing after-sales service to customers and strengthening communication with customers are effective methods. At the same time, franchise stores can promptly reward old members through membership discounts and other activities to improve customer satisfaction and loyalty.

In order to expand the market and discover new customers, franchisees can adopt a variety of business methods for marketing. For example, the joint operation method: you can form a joint venture with nearby coffee shops, cinemas, Internet cafes and other commercial institutions with the same customer base. For example, if you buy a specified product, you may get a movie ticket, etc.

5. Coordinate with the franchise headquarters to advance

The franchise store and the franchise headquarters have a very subtle relationship. They are interdependent and each has its own axis of interests. Therefore, it is inevitable that there will be some conflicts between franchise stores and the headquarters. Franchise stores often complain about the bureaucracy at the headquarters, which only knows how to give blind orders and lacks understanding of the actual situation; the headquarters also thinks that the franchise stores are self-centered, insist on having their own way, and do not support or cooperate with the work of the headquarters.

This situation often occurs because the franchise stores are more or less suspicious or resistant to the company's policies, or at least wary. Therefore, franchisees should invest a lot of energy in investigating when choosing to join the headquarters; once the franchise is successful, they should actively cooperate with the work of the headquarters with the mentality of "creating a win-win situation".

The so-called excess is not enough, doubt, resistance and complete dependence are not the way for franchisees to do business. The UK-China Entrepreneurship Lab reminds franchise entrepreneurs that since most areas in our country are very regional, and the consumption levels and consumption concepts of various cities and regions vary greatly, the successful business strategies of franchise headquarters elsewhere may not be suitable for local businesses. Franchise store. Therefore, franchisees should actively communicate with the headquarters on the basis of listening to the opinions of the headquarters, deliver local information in a timely manner, and use the headquarters' existing experience to jointly explore business strategies suitable for local conditions.

6. Actively accumulate industry experience

Industry experience is Hanxin’s starting point for franchisees, the more the better. The so-called "separate lines are like mountains apart, and people working together have different benefits" are caused by familiarity or lack of familiarity.

Industry experience is difficult to gain from one or a few books, and many things can only be obtained through personal experience. Therefore, franchisees should pay attention to everything and accumulate more. For example, if you open a franchise store of a certain clothing brand, franchisees should read more popular magazines and participate in more fashion events to cultivate their own unique fashion concepts and keen fashion sense. When every customer walks into the store, you can use your unique vision to provide a match that suits them. Are you worried that the franchise store's turnover will not increase by leaps and bounds?

To sum up, in order to succeed in franchising business, franchisees themselves must work hard and learn how to operate, so that their efforts can generate multiple returns and increase the probability of successful profit!

Chain chain The Four Key Factors for Successful Franchise

Start a business, open a store, and be the boss! This has always been the dream of many people, especially for office workers who are tired of working nine to five, and they are even more eager to have a career of their own. Opening a small shop and becoming a small boss often becomes These are the favorites of would-be entrepreneurs.

The chain franchise business model seems to be becoming more and more prosperous at present. After many store owners have opened two or three stores and their business is booming, many people who want to start a business come to inquire about joining. Once there are many people asking to join, the boss will often think that since so many people want to join, they can open franchise stores to expand the chain territory and collect franchise fees, so of course they will open the door. However, success or failure often remains undecided.

However, what are the key factors for the success of franchise stores? Based on the author's many years of observation of the chain industry, it should include four major factors: simplification of store operations, popularization of products, popularization of business districts, and stronger channel brand charm than product brands, which are summarized as follows:

First. , Simplify store operations. The basic concept of franchising is brand authorization and KNOW HOW teaching. Franchisees want to join because they do not understand business technology. This means that laymen can operate through short-term education and training. In the short term, it is necessary to In order for franchisees to transform from laymen to experts, the techniques of store operation must not be too difficult and must be simplified.

So, the reason why convenience stores can open a large number of stores is because the store operations are simple. The clerk only needs to know how to operate the cash register, change money, and replenish the goods when they arrive. The work is very simple. Simplification, therefore, no matter how the work-study students in the store change, new employees can always quickly get online operations in a short period of time. Some people joke that simplicity means that except for dead people and white suspects who can’t do it, everyone else can do it. It's called simplification.

Second, the product must be a mass consumer product. Many people believe that in order to do a good business in a store, the products must be unique, distinctive, and different. This concept is not wrong, but the premise of this concept is that it only applies to single stores, famous stores, and multiple stores, that is, It only applies to the number of stores within a certain scale. Once the store is copied to a large number of stores, the products sold can no longer emphasize the unique niche market, but must move towards the popular consumer market