Putting It All Together…On the Path to the Next Phase (4)
This is the fourth set of the wrap-up exercise I embarked upon four weeks ago with my Billionaire Friend. My meeting with him four weeks ago was a short one: it was essentially a review session, and we went through the entire project and looked at the feedback from the readers. My friend confirmed we needed to move to the next phase but that would require a recap of what we have done so far to put people in the picture again. So here is the fourth set of recaps. Enjoy.
Session 23
BUILDING WEALTH, NATIONAL SECURITY AND FRANCHISING
Wealth and National Security
SESSION 24
Building wealth through franchising
“A business franchise allows franchisees to pay franchise fees and get the system developed by the franchisor with the right to use the franchisor’s name for a specific number of years, which is usually spelt out in the operating franchise agreement.
The business franchise is the most common type of franchise, which allows wealth builders to buy the licence to businesses with established brand names. Such wealth builders’ new franchise businesses would often be supported by the category of the franchise throughout the initial stages of business. Such support may continue to be extended throughout the life of the franchise businesses. In return for this business support, franchisees will be exposed to having access to experienced professionals and the right to use the brand name of the franchisor. The franchisee is however obligated to pay royalties to the franchisor regularly as per the agreement reached between both parties. The best example of this class of franchise arrangement is found in the fast-food industry. The global example of this class is Kentucky Fried Chicken and McDonald’s. The Nigerian examples include Tantalizers, Tastee Fried Chicken, and Chicken Republic. These franchisors allow franchisees to use their trademarks and brand names and take advantage of the economics of their supply logistics and the secrets behind their menu of foods. This arrangement sometimes requires the franchisors to continuously train their franchisees to ensure the maintenance of famed products and services of top quality in line with the franchisor’s standards. They may also guide their franchisees with internal audits to help block income leakages. Marketing expertise is provided chiefly to franchises to optimise franchisors’ profitability, business expansion, enhanced business images, etc.”
In total, this arrangement benefits both the franchisee and the franchisor. It is highly recommended for newly retired employees who do not have business ownership experience to take advantage of the available franchise support system to start good businesses of their own.”
This franchise focuses on giving out franchise licenses to individuals who sell products and delivery services in specific fields. The franchisors in this arrangement allow franchisees to use their brand names and trademarks, provide them with uniforms and equipment to properly represent franchisor brands and provide support to franchisees to deliver products and services to third parties. Product franchises are an excellent option for start-up wealth builders, independent contractors and home businesses. The investment outlay needed under this franchise class is usually smaller than that of the business franchise. Examples of independent contractors’ franchises are companies that have already established good names and reputations for their contracting services in their field of work and issue franchise licence to franchises.”
“Manufacturing franchises are the third classification of franchise arrangements. In a manufacturing franchise, the franchisor allows the franchisee to produce products and provide services using the franchisor’s brand name and trademark. This type of franchise is very popular with food and drink companies in the manufacturing industry. The best example of this franchise is with soft drink companies. Here, the parent company would produce a concentrated syrup and then sell it along with the right to use its brand and trademark to a bottling franchisee company which would mix the syrup with various ingredients and then sell the bottled drinks. An unlimited choice available to wealth builders who still feel very passionate and ambitious after building their franchise businesses to successful levels, but want to expand to other locations or other businesses, is to simply retain control of their existing franchise and continue generating profits from them while expanding to other businesses outside their franchise.”
We stop here for this week. I can’t wait to catch up with you next week.
QUOTE 1
National security is essential to wealth building and sustenance because wealth creation only thrives in peaceful environments and nations. It relates to direct threats to the physical well-being of the population and jeopardises the stability of a country, its economy and institutions.
QUOTE 2
Franchise business arrangements have globally proven to be successful for wealth builders, with little know-how about the line of business of their investment interest. Hence in a franchise arrangement, one does not have to worry about building a recognised and trusted brand, developing well-trained support teams, and finding reliable advisors to help them to manage their businesses.
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