The Art of Franchising
What Does "Franchise" Even Mean?
The word “franchise” is often met with immediate recognition followed by complete confusion about the details. Franchises run the gamut, from home care concepts to service industries. Below is a guide to help you understand exactly how a franchised business model works. We’ll cover everything from who owns the business to where the royalty money goes.
Think of the franchised business as a piece of studio art. We’ll revisit this analogy as we go.
Who Owns the Business?
There are essentially two owners of every franchise location. There is the franchisor who is the creator and/or owner of the brand and business model, and there is the franchisee who is the owner and operator of the specific franchise location/territory.
Think of a franchisor as an artist who owns a studio. The artist allows select people (franchisees) to join the studio, trains them to paint in a certain style and mentors them as they work. Those who buy into the studio can then sell their completed paintings using the franchisor's name and reputation.
What Does the Franchisor Provide?
The franchisor provides a reliable business model and extensive training on everything from forming an LLC to serving their first customer or client and everything in between. After formal training is complete, the franchisor provides ongoing support to help ensure that the franchisee is able to run a successful business.
Those who have bought into the studio are given comprehensive training, as well as all of the materials and support they need to create a successful product. The studio owner (franshisor) oversees the other painters in the studio (franchisees) and assists with anything they may need.
When I Buy Something From a Franchise, Who Gets the Money?
This depends on each individual franchise concept and varies based on their royalty fee. Generally speaking, after an initial franchise fee is paid to buy the business model, the franchisor will receive a small percentage of the gross monthly or yearly sales. This royalty ensures continued help from the franchisor to support the franchisee with all of their needs.
The studio painter (franchisee) begins selling their paintings, and the studio owner (franchisor) gets a small cut of each sale for providing the studio, training, recognizable name and ongoing support that they have received.
Who Buys a Franchise?
Anyone who wants to buy a franchise has the opportunity to do so. Most franchisees are hardworking people who want to be their own boss, are looking for a new career path or simply want to bring a great service to their local community. A franchisor will not grant their business model to just anyone, as they are looking for high-quality individuals who are ready to run the business and grow the reputation of the brand.
The master artist’s reputation is extremely important. It takes years of practice, effort and skill to create great works of art. For quality assurance, the master artist (franchisor) must choose studio members (franchisees) who will take direction well, are fast learners and have a strong work ethic. The canvas cannot paint itself after all. There is a vetting process, and only the most qualified people will be admitted to join the studio.
Why Is the Franchise System Successful?
This question can be broken down in several ways. Two of the biggest factors are brand recognition and consistency of product. The best example comes from the McDonald’s franchise. The name, logo, menu and general layout of each location are readily recognized all over the world. A Big Mac from a McDonald’s in Miami will look and taste the same as a Big Mac from Portland, Oregon.
Consistency is the product of proper training. Franchisors have perfected their businesses. They have already made the mistakes, found the solutions and implemented the best processes. The business model is solid. It is the franchisee’s job to learn it and replicate it.
In a franchise, the learning curve for new business owners is greatly reduced. They are given the blueprints, as well as a mentor, to help guide them through each phase of the business. The shortened learning curve and specialized training allow for a consistent product, which, in turn, creates brand loyalty.
The artist (franchisor) is driven to produce exceptional artwork. The goal is for each and every studio painting to match up to the master artist’s original work. Since the artist (franchisor) is allowing others to operate and sell paintings under their name, he or she must protect their reputation as an artist and make sure that those invited into the studio do a great job. It also holds the franchisor accountable to This is also why it is important for the master artist (franchisor) to provide adequate training and continued support to those working in the studio. It is important to push the brand forward.
Is Franchising Right for You?
Owning a business is no walk in the park. It takes time, energy, dedication and hard work. Just because you have been given the keys to the car does not mean it will drive itself. The same goes for a franchise.
As a franchisee, you are the boss of your own franchise location, but you are not in charge of the brand. The best franchisees are quick learners, take direction well and execute the business plan to a T. Problems arise when franchisees think that they have a better understanding of the business than the franchisor and deviate from their training. Chances are, the franchisor has already tested the franchisee’s method and has found that it does not work. This is the nature of experience.
The best franchisors not only support their franchisees but continue to improve upon the business and grow the brand. This can be through new technology, marketing strategies or operational procedures. If an idea fails, the franchisor will be at a loss, not the franchisees. The best franchisors are working to improve the business for you.
The master artist (franchisor) is established in the art community. Their paintings feature a very specific, unique style that has been honed with years of practice. There is no way that anyone else could do a better job of painting in the style of the master artist than the master artist themself.
That is not to say that the master artist shouldn’t be open to suggestions and input from those working in the studio. The studio painters have excellent perspective and experience all their own. At the end of the day, it is the master artist who has the final say in regards to what is going to be painted and how. As they drive the direction of the studio, they also work to improve its recognition, product and processes. This ensures that both the studio and its painters will continue to thrive.
Hopefully, we have cleared up a few of your questions regarding the franchise business model. Being a part of a successful franchise is an incredibly rewarding experience. If you are interested in joining the Blue Moon Estate Sales franchise family, reach out today.
No painting skills required.