Frequently
Asked Questions about Franchising and Automotive Franchises
What
is Franchising?
By definition, a franchise is a legal/commercial relationship between the owner
of a brand name, proven method of business, trademark, or trademark and an individual
seeking the right to use that those aspects in a business. The Franchise Agreement
outlines the rules and regulations under which the two parties will conduct
business.
To break it down ... a franchiser
owns the right to a name or trademark and sells that right to a franchisee -
known as product/trade name franchising. In the more complex form, known as
business format franchising (what our database is mostly comprised of), an ongoing
relationship exists between the two parties. This latter type of franchising
often offers other aspects of running a business, including but not limited
to:
• Site selection.
• Training.
• Inventory.
• Marketing Strategy.
• Financing.
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What
Are Some Rewards of Franchise Ownership?
Franchising is typically reserved for those individuals who desire to be
their own boss and run their own business. Due to the number of different avenues
one can take within the world of franchising, the industry itself tends to attract
people from a variety of backgrounds - both cultural and professional. It's
no longer an industry reserved for the "white collar" businessman.
In significatnly increased numbers, women and minorities are joining the franchise
world, as is today's youth, recent college graduates. Investors at all levels
are finding that few financial investments can compete with the potential income
and personal growth of an established and reputable franchise.
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Why An
Automotive Franchise?
The automotive industry has grown over the past few years. Recent events
have consumers shying away from air travel therefore, not only are the car rental
franchises flourishing, but people are using THEIR own cars more frequently,
which has led to an increase in new product sales and maintenance and auto repair
businesses as well. Become a part of this ever-growing and profitable industry
by searching for your new business here, at automotivefranchise.com
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What
Factors Should I Consider When Selecting a Franchise?
Similar to any other major business venture or financial investment, the purchasing
purchasing a franchise is a risk. When selecting a franchise to invest in, take
into consideration the following:
- demand
- market/competition
- training/support
- expansion
- operational
abilities
- brandname
- years
in business
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What
is the Disclosure Document?
The Federal Trade Commission (FTC), a federal government commission requires
those selling franchises and other business opportunities to give potential
investors the necessary information they require in order to arrive at a sound
financial decision. It also mandates that all earnings claims be documented.
Furthermore, the information that potential investors receive MUST be complete
and accurate and that the investor is allotted enough time to analyze and investigate
the disclosures PRIOR to making any final financial comittment. THis information
is to arrive in the hands of the potential investor's hands in the form of a
"Disclosure Document" - this must be recieved at least 10 days before
any purchase as well.
All required information
is given to prospective investors in the form of a franchise disclosure document,
which must be furnished at least 10 business days before any purchase may occur.
Please note - we recommend seeking professional and legal advice prior to the
commitment of any major financial investment.
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