A franchise is a branch of a large distributor of goods and services. Franchises have been known since ancient times as the concession that the owner of a business gives to a third party in order to distribute and obtain profits from the sale, having these rights and permits for the distribution of products or services. From this right, not only the name of the distributor is obtained, but also the link for future businesses that are developed.
The head office owner or " The Franchisor " transfers all its operating systems, technical knowledge, marketing systems, training systems, management methods and all pertinent information for the branch to start operating. It also trains the new investor or " Franchisee " and provides training and support throughout the life of the Franchise Agreement.
The Franchisor already with experience in the matter, offers the Franchisee the maximum guarantee of profits, indicates the strategies and best places to place the business, His concept must have a high degree of systematization. The franchise must provide opportunities, not generate problems, that is why the owner must create a system that makes the work of his new partner easier, thus reflecting experience and security. But just as the Franchisor must guarantee that the Franchisee is " Comfortable ", he must also ensure that the branch of his company complies with the provisions of the agreements.
The word Franchise dates back to the Middle Ages, meaning a privilege or a right. Then, the sovereign or local lord, granted the right to occupy markets or fairs, or to hunt on their lands. Over time the rules governing franchises became part of the Common Law of Europe. This business format is one of the most popular and sustainable of the moment. Large companies have survived the onslaught of the economic crisis thanks to the expansion that is generated from the generation of different distribution points.
