Franchise Business

Franchise chain is a popular business development mode in the world today, and is also one of the most popular commercial formats in the mainland.

Mr. Ding, who once joined the "elephant king laundry", said very well: having a chain franchise is like adding a crutches to small and medium investors to start a business. It can make your pace bigger and more stable. Even if you encounter small risks, it is easier to support it.

Industry insiders say that franchise is becoming a "shortcut" for some entrepreneurs in Shanghai.

Is it really a "Jinshan" chain?

It is a bit dazzling for investors to have a threshold and face numerous investment projects.

In this regard, general manager of the real pot coffee and Mr. Zhang Zhende, the old wizard, have their own secrets.

As one of the ten major chain brands in Taiwan, it has been developing rapidly in Shanghai in recent years.

Although the franchise fee of 1 million 270 thousand yuan per store is almost sky high for small and medium investors, there are more than 20 franchises in Shanghai, which shows that its return on investment has been accepted by investors.

Mr. Zhang believes that a successful franchise investment project must have two thresholds: capital threshold and technical threshold.

If a franchise project does not join the fee, business mode or technology is very easy to grasp, then the success rate of investment in this project is almost zero.

He gave an example: 4, 5 years ago, there was a very famous franchise brand in Taiwan: Goubuli soup bag.

At that time, the store claimed that it would only cost about 10 thousand yuan to join the club, and anyone could become a franchisee.

The project was launched in only 3 months, and the number of franchisees reached 1000.

Just as everyone was complacent, almost all the franchisees collapsed in fourth months.

Why?

It turned out that because of this low franchise fee for franchisees, it can not constitute a financial threshold for the franchisee, and the technical threshold is even more impossible. Therefore, a large number of similar soup shops have appeared on the market, and the market share has been "diluted".

The franchisees had hoped to protect themselves by joining the alliance, but it turned out that the "same kind" was fighting for each other, and the advantages of the franchisee disappeared, and the failure was inevitable.

Market demand is the key. Besides technology threshold and capital threshold, the choice of franchises depends on whether there is enough market demand.

Mr. Zhang also gave an example: in those days, the project of selling Macao egg tart was once popular in the island. The franchise fee of this project is about 12 to 150 thousand yuan RMB, and it needs certain technical requirements. It should be consistent with the basic requirements of franchise.

However, the egg tart is a high calorie food, and most of the buyers are young women. Girls are most afraid of gaining weight. Therefore, it has only been popular for a few months. When the newspaper pointed out this, the franchisees would never see any more.

Mr. Sheng, deputy director of Shanghai employment guidance center, analyzed the failure cases of chain enterprises, pointing out that the immature project of chain affiliate is indeed the biggest problem in this field.

There are many domestic chain enterprises, holding a product, ask the consulting company to design a chain project, go to the market vigorously to find franchisees, and some enterprises are not familiar with the "rules of the game" of chain operation. There is no one in their own stores, not to mention the mature management experience, but also to engage in franchise.

Therefore, whether the project is chosen is directly related to the life cycle of the start-up enterprise.

In addition to the choice of projects, how to manage a chain store is also a headache for many entrepreneurs.

Mr. Wang, who once opened a famous brand chain soybean milk shop in North Sichuan Road, said that after joining the brand, less than six months later, not only did he spend 800 thousand yuan in the initial investment, but he also lost a lot of money, but in desperation he had to give it to someone else.

Mr. Wang said frankly that the first investment was lost in the "management".

At the beginning of the site selection, the owner had objections to the store on the two floor, but he did not listen. In the subsequent operation, the leader had asked the store to increase the intensity of the outward delivery, and Mr. Wang did not accept it.

After losing the game, Mr. Wang realized that if he had kept unreservedly in accordance with the uniform rule of the main business, he might not have lost so badly.

Many of the franchisees of chain stores have encountered such miserable experiences as Mr. Wang.

For this reason, some famous chain enterprises have begun to reserve "professional managers". Among them, the "trusteeship system" of the franchise manager of the Xian Lin Restaurant Company is very innovative to separate the managers and investors from the chain stores.

The specific practice is that all investors who join in the celestial forest must hire a store manager who is dispatched by Xian Ling Lin for a year's "trusteeship management". The franchisee pays the manager 2000 yuan a month.

The store manager implements the management of the franchisee completely according to the requirements of the leader.

The first use of "trusteeship" was launched in April last year. It has been doing well for over a year, giving investors a taste of sweetness.

"Buyout" or "leasing" as an important part of investment franchise, choosing a good shop is the most critical step.

At present, the shops in Shanghai's top lots often rent more than ten million yuan a year, or even millions of yuan.

But for small restaurants such as coffee shops and black tea shops, a good location often leads to unexpected business.

A good shop in the city is bought or sold.

Investors often face such multiple-choice questions.

Franchise experts believe that buying or renting depends on the needs of franchising itself, as well as the financial ability of franchisees.

Of course, if the price is right, it is generally advised to buy it.

Because lots of good shops have great potential for appreciation, and even if they do not need them in the future, they will probably gain unexpected profits when they resell or rent them at that time.

If you are only renting shops, then, from the trend of increasing rent in recent years, you may be forced to pay more or even double the rent.

Therefore, if you have enough financial strength, you may as well buy the shops.

Of course, some small-scale franchise projects, because of the protection of the franchisee, stipulates that the franchisee can only rent a shop, and the monthly rent must be limited.

In this case, you have no choice.

As for the "free lunch", with the growing number of chain investors, some fraudulent criminals are using the franchise to cheat.

Recently, the case of linxu chain gem processing chain was very representative.

In this case, Huang Baohua, a criminal suspect, has defrauded more than 20 franchisees from signing up a gem processing agreement through the media to play a guise of helping "4050" to start a business, and altogether cheated the franchise fee of 1 million 850 thousand yuan.

If we say that "linxu chain gem processing chain" case is easy to arouse people's vigilance because of its fraudulent nature, now some chain join enterprises take the opportunity to sell inferior products to franchisees, so it is very easy to be fooled.

Experts in the field of business guidance have reminded the franchisees that there is no "free lunch" in the world. A successful franchise project not only has huge investment in the early stage of the project itself, but also contains a lot of intangible assets. Therefore, the franchisees will also pay a higher fee for joining the franchise.

On the contrary, if it does not receive a single cent, then its market prospect is very doubtful.