how to start sole proprietorship, existing business, franchise?
Answers
Answer:
Sole Proprietorship: If you choose not to form an entity to operate the Franchise Business, then you will be considered a sole proprietorship (if the franchise is owned by a single individual). A sole proprietorship exists when a single individual operates a business and owns all of the assets.
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Explanation:
Franchising is based on a marketing concept which can be adopted by an organization as a strategy for business expansion. Where implemented, a franchisor licenses its know-how, procedures, intellectual property, use of its business model, brand, and rights to sell its branded products and services to a franchisee
. In return, the franchisee pays certain fees and agrees to comply with certain obligations, typically set out in a Franchise Agreement.
A franchise is a type of business endeavor that is purchased and operated by an individual often referred to as franchisee. However, it is always looked upon as the original brand and controlled by the original company known as the franchisor. Many of the stores and restaurants that you visit every day are franchises including McDonald’s, Subway, KFC, Ace Hardware, Pizza Hut, Hilton Hotels etc.
When you are purchasing a franchise, you are actually buying the rights from the parent company to operate it by leveraging a proven business model, whilst conforming to the price and services offered by the brand. You also full access to the company’s trademarked components such as logos, slogans and signage.
How to become a franchisee?
If you’re interested in purchasing a franchise then this is the most useful question to look out for answers. In order to become a franchisee, you’ll have to pay an upfront franchise fee. You then get the right to use the following –
The company’s brand name
The company’s business system
The operational manual
The marketing materials
The brand’s operation software
The company’s proprietary materials
Exclusive geographical territory to operate the franchise
5-10 years of contract with the company
5-step plan to buy a franchise
Go through this infographic to understand the 5-step plan to buy a franchise and the crucial factors to consider and determine before kick-starting the venture –

How does a franchise work?
There are usually two types of franchising – product franchising and business format franchising
Product Franchising –In this type of franchising, the franchisee gains to right to use the company’s name and trademark so as to operate the franchise. The company provides the products to the new owner for selling under the parent brand name such as a car dealership. A car showroom owners get permission to sell certain brands of cars, but the store operates independently. Unlike McDonalds and KFC, in this scenario, the owner, say, the car dealer can localize the name of the franchise.
Business Format Franchising – In this type, the franchisee receives regular supplies from the company apart from the rights to operate under the parent name. This is mostly seen with the cases in fast food chains. For example, the franchisee of McDonald’s receives regular supplies of raw materials for burgers and fries to create the McDonalds copyright food items and sell them under the brand name.
Benefits of the franchise ownership over having a business of your own
Below are some of the reasons you might consider operating a franchise rather starting a business of your .