The initial term of franchisee M.O.U is of 1 year. At the end of the Initial Term, this M.O.U. shall automatically renew on mutually agreed terms which may include covenants regarding change or alteration in the area of operation and/or revenue-sharing basis for successive periods of 1 year (a "Renewal Term").
Do I need any license to operate this business?
No, you dont need any special license to operate this business however you have to obtain all the licenses, all and any permissions under any Statute or by-laws or Rules of Government etc and, in compliance with the Local Municipal Laws.
What will be my responsibility as a franchisee?
Addworld is looking for business partners who will take care of marketing our products in the local Market. We are looking forward to full marketing support from your end. You can either take care of marketing yourself or you can appoint couple of marketing executives. We will provide you 100% technical support and initial training to you and all concerned
What kind of marketing support I would get in this relationship?
As soon as the full and final payment including service tax towards franchise fee is paid, Addworld will provide initial training, manuals, presentation, brochures and onsite training.
What kind of technical support I would get in this relationship?
Addworld will provide you with 100% technical support. So, to start our franchise business no technical experience or background in required.
What are the companys expectations from a franchisee?
Addworld is looking for likeminded people who will drive business in their territory by appointing couple of sales executives. Addworld is not looking for mere investors but aggressive entrepreneurs who can penetrate the market.
Can I have support of any company representative to clarify my doubts, clarifications to improve my business?
Yes, a key account manager will be a single point of contact, for all your franchise operation queries.
What is the process of getting started?
You will be depositing the franchisee fee with a letter of intent (LOI) expressing to become our franchise.
What is franchising?
Franchising is a method of distributing products or services. At least two parties are involved in a franchise system:
(1) The franchisor, who lends his trademark or trade name and a business system;
(2) The franchisee, who pays a royalty and often an initial fee for the right to do business under the franchisors name and system. Technically, the contract binding the two parties is the franchise, but that term is often used to mean the actual business that the franchisee operates.
What are the things you need to be careful about before entering a franchisee business?
Who is the Franchisor?
The principals of the company and their business background as well as the history of the venture.
What is the Offering? Exactly what is being offered? This section describes the length of the agreement, territory, responsibilities, opportunities, etc.
How Much Will it Cost? Initial fees, royalties, advertising fees, start-up costs for equipment, and working capital are covered.
What Does the Company Promise? Will they train? Develop training materials, ad programs, generate accounts?
What do you promise? Most franchisors will restrict your activities to prevent you from using their system without paying royalties, during and after the agreement ends.
Financial History of the Franchisor. Is the company stable? Will they be in business for the long-term?
What are the advantages of franchise business?
Avoiding the unnecessary trial and error period in starting and operating a new business.
Lower financial risk, compared to other ventures, because investment costs are lower and profit margins are higher.
Business Format Franchising complete packages ensure a ready to go "turn-key" franchised unit.
Managing a small business whilst depending on the power of the franchisor company which has a bigger organization.
The franchisee has an opportunity to run a proven business concept with a successful operational track record.
The opportunity to learn the latest developments and changes in the local and global market from the franchisor and focus entirely on developing the sales revenues.
The benefit of operating under a recognized trade name/trademark, which can have better marketing results.
The franchisee has access to accumulated business experience and technical know-how in managing the business
Franchisors offer ongoing support: training, operating procedures and operating assistance, ongoing supervision and management support, operating procedures and operating assistance
The franchise business model can get you established and profitable in a shorter time than other small business ownership options and industry experience is not a requirement. Other benefits of the franchise business model are that the franchisee has the proven marketing and support systems of the franchisor and the contractual process allows for a level of transparency that minimizes the risk of business failure for many of the same reasons that other small business ventures may fail.
What is a business model?
Business Model is method or means by which a company tries to capture value from its business. A business model may be based on many different aspects of a company, such as how it makes, distributes, prices or advertises its products.
The business model concentrates on value creation. It describes a companys or organisations core strategy to generate economic value, normally in the form of revenue.
The model provides the basic template for a business to compete in the market place, it provides a template on how the firm is going to make money, and how the firm will work with internal players (firms employees and managers) and external players (stakeholders such as customers, suppliers, and investors). The business model indicates how the firm will convert inputs (capital, raw materials and labour) into outputs (total value of goods produced) and make a return that is greater than the opportunity cost of capital and delivers a return to its investors. This means that a business models success is reflected in its ability to create returns that are greater than the (opportunity) cost of capital, invested by its shareholders and bondholders.
What is break-even point?
The Break-even Point is, in general, the point at which the gains equal the losses. A break-even point defines when an investment will generate a positive return. The point where sales or revenues equal the expenses incurred. Or also the point where total costs equal total revenues. There is no profit made or loss incurred at the break-even point. This is important for anyone that manages a business, since the break-even point is the lower limit of profit when prices are set and margins are determined.
What is Return on Investment?
Return on investment, or ROI, is the most common profitability ratio.ROI deals with the money you invest in the company and the return you realize on that money based on the net profit of the business. You can use ROI in several different ways to gauge the profitability of your business.
A measure of the net income a firm is able to earn with its total assets. Return on investment is calculated by dividing net profits after taxes by total assets.