Modern business, reminiscent of a full ecological system, the introduction of that new species is very difficult, because all the ecological niches are filled. That is, no matter where come the young businessman, it is waiting for the fierce competition and pressure from the more developed businesses. As a consequence, young businesses are often not competitive and in 1-2 years, disappears, and with it disappear and capital invested in it. Such a situation could be a deadlock if, continuing biological comparison, the new species, oh, that is, new businesses, could be developed with the support of more powerful business structures already unfolded.
One of these types of support is franchising – providing the right to use the franchisor has already promoted brand for young entrepreneurs (franchisees) to run their business. At the same franchise – is not only the brand, but more often, and technology experience (the franchisee is trained), as well as the flow of information in human society (for example, the fashion for a particular version of the activities or goods).
This commercial symbiosis franchisor brings additional finance in the form of lump-sum payments and royalties from franchisees, as well as an increase in the spread of brand influence (as in biological analogy, the more abundant species is more difficult to destroy than rare). What is more effective franchising, the more stable is the position of the franchisor. For franchisees, the bonuses are expressed in his defense during the initial stages of development under the maternal wing of big business, providing training and – as a consequence – the rapid growth.
For these reasons, the franchise has now won widespread as all over the world, and in Ukraine, despite the poor drafting of its legislation in this regard. The longer, the more there is a franchise areas. First of all it concerns the expansion of supermarket chains and retail stores, as well as the network of cafes, restaurants, fast food outlets.
Example hyped national brand franchise network in retailing
The rapidly evolving and it is in the service sector, such as transport companies and taxis (among which there are also those that provide services of nonresident visitors and tourists). A special place is the development of franchising in the real estate rental market in particular – apartment rent. There is a very large room for growth, as the business of renting of apartments has not to date, competing franchise systems.
Franchise – rented apartments – everything is thought out to the smallest detail!
The disadvantage of the process of development of franchising is to reduce the diversity of the business ecosystem, ie the consolidation of several major brands in the background of small extrusion on the periphery of the market. With the ousting of small players, or fall out of the scenario, or remain as separate islands, not increasing turnover, or (with luck) become an elite unit, inaccessible to the majority, but it has a very large momentum (as, for example, the unique super-expensive restaurants, analogues simply no).
A significant redistribution of businesses towards the development of large networks is still not the best option for consumers because it reduces the choice for sharp market changes. A reasonable relationship between the existence of larger businesses and access to a good level of new, evolved using franchising – optimally. This balance ensures a reliable functioning of the market due to the large stable businesses, and diversity, and insurance with fluctuations – due to the large number of not so large, but less effective distribution business. For example, the existence of chains of hotels under the franchise system in the country does not prevent the development and individual hotels, and rental of networks of apartments, which are on the territory of Ukraine with its own franchise offer, as of 2016, there is only one – the company Arenda Group, which holds great prospects for young entrepreneurs in the new, still undeveloped niche.
