The Scariest Monster of All Sues for Trademark Infringement

The Scariest Monster of All Sues for Trademark Infringement
Fancy Audio-Cable Outfit Defends Its Brands; A Mini Golf Course Fights Back
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By STEVE STECKLOW

When Christina and Patrick Vitagliano dreamed up their Monster Mini Golf franchises -- 18-hole, indoor putting greens straddled by glow-in-the-dark statues of ghouls and gargoyles -- they never imagined that a California maker of high-end audio cables would object.
But Monster Cable Products Inc., which holds more than 70 trademarks on the word monster, challenged the Vitaglianos' trademark applications. It filed a federal lawsuit against their company in California and demanded the Rhode Island couple surrender the name and pay at least $80,000 for the right to use it.
"It really seemed absurd," says Ms. Vitagliano.
Video
Watch the YouTube video of Monster Cable's Mr. Lee and Monster Mini Golf's Ms. Vitagliano.
The legal actions were nothing new for Monster Cable, which was granted its first "Monster" trademark in 1980. Since then, the company has fought more monsters than Godzilla did.
Over the years, it has gone after purveyors of monster-branded auto transmissions, slot machines, glue, carpet-cleaning machines and an energy drink, as well as a woman who sells "Junk Food Monster" kids' T-shirts that promote good eating habits. It sued Monster.com over the job-hunting Web site's name and Walt Disney Co. over products tied to the film "Monsters Inc." It opposed the Boston Red Sox trademark applications for seats and hot dogs named for the Green Monster, the legendary left-field wall in Fenway Park. All in all, Monster Cable says it has fought about 190 monster battles at the U.S. Patent and Trademark Office and filed around 30 monster lawsuits in federal courts.
Along the way, it has attracted its share of ire from those who say it is overreaching and trying to corner the market on a word, not a brand. "If Monster Cable prevails, the Gila monster will become just another lizard" and "the monster under your bed will have to become an ogre," wrote Michael Meadors of tabberone.com, a Web site that sells fabrics and also keeps tabs on trademark issues.
"Monster Cable's practice of suing anyone using the word 'Monster' in their name is nothing short of playground bullying," says Robert Holloway, a computer contractor in Iowa who set up a Web site called monstercablebully.com to support the Vitaglianos.
Monster Cable says its trademark challenges are a matter of necessity. "If you don't defend your mark, and people use [it], it runs the risk of becoming generic and then you lose the mark," says Noel Lee, founder of the Brisbane, Calif., company, whose corporate title is "Head Monster." Mr. Lee says the company sells many other monster-branded products besides cables that it has to protect, including music, clothing and candy mints.
To a legal novice, it may seem odd that a common word like monster can be trademarked at all. But in the complex and sometimes murky world of trademark law, common words can be registered, provided they are associated with specific classes of goods. Apple Inc., for example, holds trademarks for the word apple when it's related to computer products, not fruit.
Sometimes, trademarks can obtain a higher order of protection, known as "famous marks." This category is supposed to be reserved for words that have become so entwined with a product and a company -- like the word visa and Visa Inc.'s credit card -- that the trademark owner can argue that no other product may use the word in its name.
David Tognotti, Monster Cable's general manager and an attorney, says the company considers "Monster" a famous mark -- on a par with Barbie dolls or Camel cigarettes. "We're protecting our mark as if it's a famous mark," he said in an interview in Monster Cable's headquarters, where the walls are lined with framed copies of the company's trademarks and patents.
Mr. Tognotti cited a chapter on famous marks in the law book "McCarthy on Trademarks and Unfair Competition" by J. Thomas McCarthy, a noted expert in the field.
But in an interview, Prof. McCarthy expressed doubt that Monster Cable possesses a famous mark. He said such determinations are made by courts. Mr. Tognotti acknowledges Monster Cable hasn't obtained such a court ruling.
Most of the company's lawsuits have been settled privately under confidential terms. In some instances -- such as the case of the Discovery Channel's reality auto show, Monster Garage -- companies have surrendered their trademarks to Monster Cable, which sometimes licenses them back for a fee. Discovery Channel declined to comment. The show is no longer in production.
In its federal civil lawsuit against Monster.com, Mr. Tognotti says owner Monster Worldwide Inc. agreed to pay Monster Cable's legal fees and post a clickable link to its Web site on Monster.com that says, "Looking for Monster Cable?" A spokesman for Monster Worldwide acknowledged the lawsuit was resolved but wouldn't discuss details.
A Disney spokesman says the company settled the lawsuit over Monster Inc.-related products without paying any compensation. Mr. Tognotti of Monster Cable says his company dropped the lawsuit after determining there was no trademark infringement.
He says Monster Cable has no plans to pursue the new DreamWorks Animation film, "Monsters vs Aliens." Says Mr. Tognotti: "We do not have a concern if a company is using the word 'monster' in a purely descriptive sense to describe actual monsters."
As for the Red Sox, Mr. Tognotti says the team agreed to withdraw or modify some of its trademark registrations for Green Monster-related products after Monster Cable argued there was "confusion in the marketplace." At the time, San Francisco's Candlestick Park was called Monster Park because Monster Cable had bought the naming rights. A Red Sox attorney referred questions to Major League Baseball, where a spokesman said the team had agreed with Monster Cable over a "procedural matter" but declined to elaborate.
Occasionally, Monster Cable has retreated. After it sued MonsterVintage LLC, an online used-clothing store based in Oregon, owner Victor Petrucci says he drove a rented truck to Monster Cable's headquarters and around San Francisco for two weeks. It was emblazoned with a giant sign that read in part, "Monster Cable S-." Monster Cable dropped the lawsuit.
"We have to balance what we do legally to protect our mark with that of public opinion," says Mr. Lee, adding, "We're very sensitive to our reputation."
The Vitaglianos say their monstrous fight erupted in 2006, two years after the couple opened their first mini-golf course. "It never occurred to me that a cable company might not like it," she says. Adds her husband, "We just all assumed it was going to go away."
Their attorney, Arthur L. Pressman, says he suggested they consider changing the name to Scary Mary's Monster Mini Golf to play down the word monster. But the couple refused to back down. By late last year, with their legal bills approaching $100,000, they agreed to try mediation. But after 10 hours, "we got really angry and sort of stormed away," says Ms. Vitagliano.
The couple then launched an Internet-based guerrilla campaign to generate public support. "We blogged nonstop, around the clock, for weeks, and enlisted much of our staff to do the same," she says. The couple offered to sell symbolic slices of "Justice" for $1 on eBay and raised about $4,400 for their legal defense. Two days before Christmas, she sent Mr. Lee a DVD of the film, "How the Grinch Stole Christmas."
Monster Cable's Mr. Lee says the company also received at least 200 angry consumer complaints. After speaking with the Vitaglianos, he decided to drop the lawsuit, withdraw his company's opposition to Monster Mini Golf's trademark applications and pay up to $200,000 of their legal expenses.

Francorp Client Brake King

Despite the recession, Brake King aims to expand
By Ashley Kelly 247-4778
March 19, 2009

-->NEWPORT NEWS — Since Brake King opened in 1966, the company has gone from having two auto bays to 21.And customer demand continues to grow despite the recession. Now the Hutchisons are expanding the family business by franchising."We knew we had to expand for our customers," said company vice president Bubba Hutchison, who said Brake King currently serves more than 35,000 people. "In the past month we've had customers come from Richmond, Woodbridge and Dale City (near Manassas). It's almost like we felt obligated to expand."The company has received about 60 inquiries since January from people considering buying a store, Hutchison said. Current plans call for the company to license four franchises, located between Richmond and the Outer Banks, by the end of the year.
Each franchise is being sold for $50,000. Brake King will receive 5 percent of the gross sales of each store. Hutchison said the franchises will range from 4,000 to 10,000 square feet. The Jefferson Avenue shop is 15,000 square feet.The company originally wanted to award eight franchises by the end of this year, but the recession caused Brake King to scale the number down to four. In five years the company plans to have 50 stores operating, Hutchison said.The strain that the economy has put on banks has made it difficult for people to secure loans or get credit, a challenge that Brake King faces while trying to sell franchises."We're in the worst recession in years. There is such volatility in the market that a lot of people have the money, but they're just sitting on it." he said.Brake King expanding in the recession may seem risky to some, but is not uncommon."It's either expand or perish, that's the American way," said Patrick Callaway, president of Francorp, a franchise consulting company based in Illinois."There are businesses that are operating in spite of this recession. After all, we all have cars and need to replace our brakes, recession or no recession."Hutchison did not want to grow the family business by opening other shops locally and hiring managers."We realized we wanted owners, not managers," he said. "We wanted people that have real skin in the game. People who are vested in the business."Hutchison said it's also about putting the family business into the right hands."Just because someone has the money doesn't mean they have a franchise .... The challenge is finding the right people, not just people that have the capital."

Francorp Client Red Arrow Diner

Red Arrow may launch franchises
By DAN TUOHYNew Hampshire Union Leader Monday, Mar. 16, 2009

MANCHESTER – The Adam Sandler Burger may be coming to a diner near you.
The locally famous Red Arrow Diner will roll out franchising opportunities across New England later this year, said Carol Sheehan, who come September will have owned the Queen City landmark eatery for 22 years.
The burger named for Manchester's favorite comedian son -- lettuce, tomato, mayo and raw onion -- has but a cameo role in a menu packed with great comfort foods.
Meatloaf on sourdough. Hash browns with grilled onions. A "Sloppy Moe" with macaroni and cheese. Not to forget a tempting dessert lineup that features cream pies, eclairs and homemade "twinkies."
All of it -- breakfast, lunch and dinner -- available 24 hours a day.
Franchising is a matter of the restaurant's reputation preceding itself. Sheehan, who is looking to hire a general manager to keep up with this year's growth, said she cannot go anywhere these days without Red Arrow recognition.
"I can be in the Caribbean and somebody knows The Red Arrow," Sheehan said.
Sheehan will retain ownership of the diner on Lowell Street in Manchester, as well as The Red Arrow Diner she opened last year in Union Square in Milford.
The Red Arrow brand is powerful. It has won numerous awards in recent years, including being rated in the top 10 of diners in the country by USA Today. In a 2007 visit by Guy Fieri of the "Diners, Drive-ins and Dives" show on the Food Network, the host raved about their American Chop Suey.
The diner draw
Diners have long been popular across the state, from MaryAnn's Diner in Derry to The Common Man's family of restaurants, which include the Airport Diner in Manchester and the Tilt'n Diner in Tilton.
During every New Hampshire presidential primary campaign, candidates saddle up to diner counters to meet voters and grab a bite. Red Arrow visitors have included President Obama, Hillary Rodham Clinton, Mitt Romney, Ron Paul and Rudy Giuliani. Celebrity diners have included musicians and actors, such as Central High graduate Sandler.

Red Arrow Diner owner Carol Sheehan and franchise manager Kim Capen, in the Lowell Street eatery last week. (MARK BOLTON)
In a way, multiple locations are a tip of the hat to the past.
There were five Red Arrow locations around the city at one point. David Lamontagne opened the original Red Arrow Diner in Manchester in 1922.
Kim Capen, Sheehan's franchising manager, has worked to ensure recipes are trademark protected and that a franchisee has a clear understanding of the diner's operating systems.
"From recipes to product descriptions to portions," Capen said, "a lot of that needs to be documented in a format to duplicate what you are doing."
Sheehan and Capen are committed to matching the right owner-operator with the right location. The right location, for example, may feature high vehicle traffic counts or pedestrian traffic counts, and proximity to businesses, colleges or hospitals.
Red Arrow officials declined to discuss the cost of a Red Arrow franchise or any financial details regarding potential franchise arrangements.
The demographics have to be just so for a 24-hour diner, they said.
"There are challenges whenever you open a new restaurant," said Capen.
Opening The Red Arrow Diner in Milford last year proved instrumental to their franchising planning.
"It was a great learning experience," Sheehan said. "We did not expect that as soon as we opened the door the place would be full and there was a line out the door."
The Milford diner, like the original diner in Manchester, is still busy. Sheehan said she has 38 employees in Manchester and 46 in Milford.
It remains a growth industry, Capen said. "Business increases every year," he said.
The success is indicative of the recession-proof operating model, according to Capen. Consumer lifestyles are also at play.
"People eat out a lot," he said. "Sometimes out of necessity."
Good and affordable comfort food remains the draw, said Sheehan. Her favorite? She could not name just one. But with a smile, she said, it is tough to beat a plate of meatloaf with gravy and mashed potatoes.

McDonald's

McDonald's names new China chief executive
Mon Mar 2, 2009 8:30pm EST Email | Print | Share| Reprints | Single Page[-] Text [+]
Market News
Global stocks rise on China hopes
China hopes, oil's surge snaps Wall Street's 5-day rout
Oil gains nearly 9 percent on U.S. crude stocks drop
More Business & Investing News... BEIJING, March 3 (Reuters) - McDonald's Corp (MCD.N) on Monday named Kenneth Chan as its new chief executive officer in China, replacing Jeffrey Schwartz, the company said in a statement.

Chan, a Singaporean, has been with McDonald's for 12 years, most recently acting as regional manager in Malaysia, Taiwan and Korea, and managing director of its restaurants in Singapore.

Schwartz, a 40-year McDonald's veteran, will retire from the company, the statement said. (Reporting by Michael Wei; Editing by Ken Wills)

Franchise Information

Fred Astaire Dance Studios is a Successful franchise chain teaching dance skills to enthusiastic students. Here is an overview of the franchise chain.

FRED ASTAIRE DANCE STUDIOS (FADS) provides its franchised community with a 50+ year tradition that gives the individual franchisee worldwide name recognition identified with dance excellence unsurpassed in its industry. The original teaching methods of the great Fred Astaire are still in place today at the company that proudly bears his name. FADS provides its franchisees with extensive business and dance training, and ensures that its franchises operate under the strictest code of ethics.

Franchisor Background
Year Established: 1947
Franchising Since: 1950

Franchised Units:
100

Company-Owned Units:
0

Total Operating Units:
100
100.0%

Geographic Distribution:
U.S.:
97
97%

Canada:
3
3%

North America:States/Provinces with the largest number of operating units:
Density
Units
1. Florida 16
2. New York 13
3. Ohio 12

Registered in Following Registration States: California, Florida, Maryland, Minnesota, New York, Oregon, Rhode Island, Virginia, Wisconsin Financial Requirements

Investment:
Minimum Net Worth:
$150K
Cash Investment:
$125K
Total Investment:
$138.5-357K
Average Total Investment:
$248K

Fees:
Initial Franchise Fee:
$15-35K
Average Franchise Fee:
$25K
On-Going Royalty:
7-8%
Average Royalty:
8%
Advertising Fee:
0.2%/$25Min

Average Number of Employees: 10 Full-time, 0 Part-timeSpace Needs (in square footage): 2,500 Min.
Preferred Sites: Free-standing Building, Strip Center

http://www.francorp.com/

Francorp Clients Continue to have Success in 2009.

Francorp clients continue to drive forward through "interesting" economy.



Francorp Client Updates:



Real Property Management: Currently have 42 locations across the country. Real Property Management is an industry leader in property management and has a wonderful system for teaching and training franchisees how succeed in this business.



Here is an excerpt from the Real Property Management Website:



Real Property Management
The Leading Property Management Companyin the United States and Canada
Featuring Over 200 Locations
Property OwnersReal Property Management is the one property management company that can offer high quality, standardized property management services in all major markets. Real Property Management has managed thousands of properties for over 20 years.



Franchise OpportunitiesReal Property Management provides each franchise with a competitive edge through training, innovative and proven business systems, lead-generating marketing methods, Internet-based property management software, and on-going support.



Click here to learn more about Real Property Management franchise opportunites.



Francorp Client Deck Rescue currently has 12 franchises openned currently!



Deck Rescue is an industry leader in the deck powerwashing industry.



Here is an excerpt from the Deck Rescue Website:



About deck rescue
Since 1995, Deck Rescue has been professionally servicing decks. We care for over 1,500 commercial and residential decks, fences, gazebos and other wood structures each year.
President of Deck Rescue, Dave Hydock, was appointed to Wolman's seven-member National Contractor Advisory Board in the fall of 2006. Then, in the winter of 2007 upon learning of Deck Rescue's plans to franchise, Wolman agreed to support the franchising endeavor. Wolman has been with us since the beginning and will continue to support us into the future.
Licensed, bonded and insured, our professional staff has been recognized for our outstanding services. Most notably by the Cleveland Plain Dealer, The Columbus Dispatch and WEWS News Channel 5.
Also, Angie's List awarded Deck Rescue the Super Service Award for Northeast Ohio in 2008 - that's SEVEN awards in the past eight years!
We are also the proud recipients of the Torch Award from the Better Business Bureau - only 11 other companies in the area were nominated for this award in 2003, and we were one of only four winners! Deck Rescue also received Honorable Mention in the 2005 biennial competition.
We look forward to bringing you our impeccable service!



For more information on franchising and Francorp's clients visit the corporate site:



http://www.francorp.com/

Francorp Process

Our Proven Franchising Method
Franchise Your Business Seminars
Want to know how franchising works? Want to know how it stacks up to other forms of expansion and what controls are in place to protect you? Attend a Franchise Your Business Seminar, held in cities across the country. Conducted by a Francorp Senior Consultant, this seminar is designed to answer your questions and provide you with a better understanding of costs, time frames and working capital typically needed to grow through franchising.
The Francorp Tour
As business owners and executives examining franchising as an expansion strategy, you are encouraged to visit Francorp's headquarters in Olympia Fields, Illinois, a Chicago suburb. Here, you are invited to tour through all of our departments, meet our staff and senior officers, and review the documents needed in effective franchise growth. Your time spent with us will allow you to gain a detailed understanding of Francorp's unique process and how this process fits your needs for expansion.
Consultation
Is franchising right for your business? How long will it take to transition your business into a franchise? What kind of costs should you expect? These are just a few of the questions that are answered when you meet with a Senior Consultant. The Francorp consultation is typically a face-to-face meeting that allows you the opportunity to obtain an impartial evaluation of your business and its readiness for franchising from a professional with strong business experience and exceptional expertise in franchising.
Franchise Development
Franchise Development is our area of expertise. Whether you are developing a brand new franchise, reworking an existing one, or converting company-owned operations, Francorp has extensive experience across a wide variety of industries. Franchise Development includes designing a strategy for expansion, legal documents, operations manuals and marketing materials. These documents are created by a team assigned to your program that works closely with your company and staff to create materials that meet your expectations and deliver franchise sales.
Franchise Sales Training
While Francorp doesn't function as a broker for our clients, as part of our Franchise services, Francorp provides franchise sales training to new and existing franchisors. Attendees are taught by industry experts with numerous years of franchise sales experience, receive a "how to" manual and personalized instruction on how to sell effectively. On an ongoing basis, Francorp provides implementation consulting to ensure that the lessons learned in the classroom work effectively in achieving sales.
Franchise Management Training
Francorp conducts a two-day Franchise Management Training course designed to educate the Client's management team on the complexities of operating and managing a growing franchise organization. Detailed and comprehensive manuals are provided to all attendees on all course segments:
Building the Franchise Organization
Training Your Franchisees
Providing Effective Field Support
Marketing as a Franchisor
Franchisor Compliance
Franchisee Relations
Franchisor Services
While franchisors have specific needs that differ from one company to another, there are some basic needs that remain the same for all franchise organizations. Franchisors need both speed and accuracy in keeping their documents in step with the current marketplace. Experience and flexibility are critical. Francorp is structured perfectly to meet these needs. From a singular document revision to a whole system audit, Francorp adapts to meet the needs of each of our clients. We have the resources and experience to assess a problem, offer solutions and implement them in a timely manner.

Francorp Services

Franchise Program Development
Development Services for New Franchisors
Francorp Consultation
Franchise your Business Seminars
Strategic Planning & Business Plan Development
Market Research & Competitive Analysis
Prototype Development Consulting
Franchise Document Drafting Services
State Filings & Registrations
Operations Consulting and Manual development
Advertising and Marketing Services
Franchise Internet Marketing
Web System Development, Guidance and Consulting
Media Plans & Budgeting
Franchise Sales DVDs
Training DVDs
Franchise Sales Training
Franchise Management Training
Implementation Consulting
General Consulting
Development Services for Existing Franchisors
Industry Research Services
Legal Document Revision
Registration Updates & Renewals
Operations Manuals Drafting, Review and Revision Services
Franchise Sales Training
Franchise Management Training
Training DVDs
Sales DVDs
Franchise Program Review
Web System Development, Guidance and Consulting
Franchise Internet Marketing
Lead Generation Services
Sales Strategy Critique & Training
Advertising and Marketing Services
Franchise Ads & Media Planning
Market Research Services
Special Projects
Expert Witness
General Consulting

Franchising in India

Franchising in most parts of the world is well established and part of everyday life. In the U.S. over $1 trillion is spent per year in franchised outlets, 1 out of every 12 retail locations is a franchised operation. Now franchising is moving into other parts of the world, most notably India.
India now presents and enormous opportunity for franchise organizations. The country has over 12 million retailers which surpasses even China. This makes India the country with the highest retail outlet density in the world.
Indians have taken to franchising like the U.S. Already in this young and undeveloped franchise environment there are over 600 franchisors franchising in the Indian marketplace today. Along with that comes over 40,000 franchisees spread out across the country and across different sectors, over 300,000 Indian employees are employed directly by Indian franchise companies there. The market is enormous with almost unlimited potential. Currently the education sector of franchised businesses is the leading franchise model, but retail is catching up. The size of the consuming class means big opportunities for more franchise development.
The potential downsides of the new Indian market are what comes along with any developing market. For one the lack of regulation can still be an issue, real estate can be tricky and skewed in some cases and financing can be difficult. But if you can deal with those, this market has loads of potential.
There are a lot of companies in the services sector that are actively looking at India to set up their franchise operations today and will continue to be in the future. The growing popularity of the franchise model among Indian business men is evident in and around the country of India. The same issues that are taking place in the U.S. are also happening in India today. More people are losing their jobs, the big companies are downsizing with the slowing the economy in many sectors. This puts more people in the franchise market who would otherwise be working in a management position at a salary.
A franchise is a way for someone to earn a living without the risk of starting their own business. The other side of the equation is that as is the case in the U.S., investors are becoming more and more wary of putting their money into the stock market today. Earning the kinds of returns that were possible 2-5 years ago are extremely difficult today. This prompts more and more Indian business people to invest in themselves through a franchise model. Overall, the Indian franchise market represents one of the largest franchise opportunities in the world today.
Franchise organizations with applicable concepts and good planning will absolutely take India into account when planning their franchise system expansion for the coming years.


Christopher J. Conner

Vice President

Francorp, Inc.

708-481-2900

http://www.francorp.com/

How to Franchise Children's Businesses - Mad Science Group

Francorp worked with Mad Science Group in developing their original franchise program and assisting them in the development and implimentation of the franchise expansion. Mad Science is the industry leader in their segment and continues to set the bar for children's oriented franchise organizations.

Here is a wonderful interview with Francorp President, Patrick Callaway and Mad Science CEO Ariel Schlien. Mad Science was originally founded in Canada and has since become a global phenomenon with the help of Francorp.

http://www.youtube.com/watch?v=yVLNmlEr5gw

For more information on how to franchise, visit the Francorp corporate site:www.francorp.com

Fantastic Sam's

Franchise Interviews Meets with Master Franchisee to Fantastic
Sam’s Jerome Williams

Any time you hear the word ‘franchise’, people think of fast food. However, did you know over
seventy-five industries are now franchising? One of these industries that more professionals from Corporate America, the IT world and aspiring entrepreneurs are entering is the hair care industry. Fantastic Sam’s® is the world's largest full-service hair care franchise, with salons located throughout the United States, as well as some salons in Canada, Singapore and Japan. Their first salon opened in Memphis, Tennessee in July of 1974 and we began franchising in 1976. Their salons have earned a reputation for providing quality hair care services, including cuts, perms and color, to the entire family. The goal at Fantastic Sam’s® is to provide our guests with unexpected quality, unexpected service and unexpected style at a great value.

With over 1350 salons, Fantastic Sam’s® provides a wide range of services including: haircutting & styling, hair coloring, texturizing and a variety of hair treatments. Their
stylists are continually attending classes presented by our very own educators to keep up with all the latest styles and trends. I had the distinct pleasure of meeting Jerome Williams who owns a Master Franchise for Fantastic Sam’s. Jerome provided us with the keys to success
in finding a franchise, training for Fantastic Sam’s’ franchisees, and the characteristics of typical Fantastic Sam’s franchisees. I hope you enjoy it as much as we did. Definition of Master Franchise Master franchises offer the opportunity for qualified individuals or corporations to purchase the rights to sub-franchise the brand within a given country or territory.

Master franchises acquire an area franchise, as well as operate in its own location. Some of the services normally provided by the original franchisor will be provided by the master franchisee and between them they will divide the franchise fee and subsequent royalties paid by
the sub-franchisee.

The Interview
Franchise Interviews – What
were you doing before getting
involved with Fantastic Sam’s?
Jerome Williams – I used to be a
medical equipment and supplies
sales representative.
Franchise Interviews – That is a
big difference from franchising.
How did you get involved with
Fantastic Sam’s?
Jerome Williams – Although I
worked in Corporate America, part of
my game plan was to one day own a
business. At least twice a year, I
would meet with a franchise broker.
I did that for 5 years until I found
something I wanted to investigate
further which was Fantastic Sam’s.
Pictured above is Master franchisee to Fantastic
Sam’s Jerome William.
Franchise Interviews – What is a
typical day like as a Fantastic Sam’s
franchisee?
Jerome Williams – Because we are a
master franchisee, there is no typical
day. It includes some of the following:
· Helping our franchisee under us with
daily operation questions,
· Creating new marketing and advertising
materials,
· Planning meetings with current and
new vendors,
· Looking for real estate for a new
franchisee,
· Interviewing and prospecting
candidates,
· Resolving problems,
· Negotiating letters of intent for real
estate,
· Creating sales and marketing materials.
-continued on back page-
M
Franchise Interviews, LLC● 327 Waterford Terrace● Easton, PA 18042 Phone 1-888-722-2785● Fax 1-800-784-8374● email- marty@FranchiseInterviews.com
An exterior view of a Fantastic Sam’s salon
franchise
In addition to all of that, we own a
Fantastic Sam’s in Lawrenceville, NJ,
which is our prototype store.
Franchise Interviews – Who is the
typical franchisee that purchases
a Fantastic Sam’s franchise?
Jerome Williams – It may be people
from Corporate America, who may
have just been downsized. We get a
lot of people from the IT world. We
also get a lot of entrepreneurs.
Franchise Interviews – What type
of skills or qualities should
someone have to be a Fantastic
Sam’s franchisee? What skills do
you typically look for?
Jerome Williams – They should have
an entrepreneurial spirit. They should
also remain open to learning as well
as be a team player because
franchising by nature is about building
a brand.
Franchise Interviews – It seems
better that a prospective
franchisee doesn’t have
experience in the industry
because they would be more open
to learning.
Jerome Williams – Without question.
Someone who has owned a salon may
struggle because they would ask
questions like, “Why are these guys
doing it this way?” and “Why do I
need to pay a franchise fee and
royalty?”
Franchise Interviews – They don’t
understand franchising.
Jerome Williams – That is right.
Franchise Interviews – What is
the training like for a new
Fantastic Sam’s franchisee?
Jerome Williams – Training is
intense. New franchisees go to
Fantastic Sam’s University, which is
a weeklong and is located in the
Boston, Massachusetts’s area or out
in California at our old corporate
headquarters. They learn
everything from soup to nuts about
the business from how to price their
products and services and how to
deal with people. There is a wealth
of information provided in the
training. The beautiful thing is
training doesn’t stop there. For our
salon owners, training is continuous.
We have a monthly meeting at our
regional office in East Brunswick, NJ
where other owners can share best
practices.
Franchise Interviews – What
advice would you give to
aspiring entrepreneurs looking
to buy a franchise?
Jerome Williams – That is a big
question that I would answer with a
couple of suggestions. Buying a
franchise is a very involved process.
If you are doing it alone, I would
suggest using a franchise broker
because they can present you with
various options based on your
interest, finances and skills. A
skilled franchise broker will help
guide your through the due diligence
process and present more than one
option to look at. That type of
guidance, which is usually free, is
invaluable. If you are researching a
franchise with a partner, than you
can divide tasks for your search.
The key to both scenarios is
education. Make sure you know
everything about the opportunity
you are looking at. Also make
certain you are mentally,
emotionally and financially prepared
to move forward if you find
something that your like.
Franchise Interviews – A lot of
times we compare it to a
marriage Jerome.
Jerome Williams – Exactly, and
like a marriage, you can lose your
shirt if you are not careful.

Francorp Newsletter

April 2008

Congratulations from Francorp!

Pet Butler has announced they have acquired one of their competitors, GotPoop-AZ.

"The acquisition of GotPoop-AZ pet waste cleanup customers is part of our continuing effort to build the Pet Butler brand into a household name so that when people think of dog poop, they think Pet Butler," said CEO Matt Bowswell.

Matt approached Francorp in 2004 seeking a program to franchise his simple pet pooper scooper business. Today, Pet Butler proudly bills itself as the "#1 in the #2business" with 97 franchise operations in 27 states.

Pet Butler provides professional pet waste cleanup and removal services plus pet stations and supplies to individual yards, parks, and multi-family communities across North America.

Francorp Heading Towards DC !

Francorp is heading towards the 17th Annual International Franchise Expo (IFE) that will be held April 11-13, 2008 at the Washington Convention Center in Washington, DC this month.

Kicking off the event will be Francorp's Breakfast Briefing on April 11th that will cover pertinent topics on selling franchises at tradeshows including lead generation, lead follow-up, and much more. This briefing is the only one of its kind in the industry and it is available exclusively to Francorp clients and their guests.

Francorp will remain present throughout the duration of the IFE. Francorp will work the trade show floor, assist clients with their booths and represent clients who could not attend the show themselves.

The International Franchise Expo is one of the largest franchise shows in the United States, with nearly 300 exhibitors of varying concepts, investment levels, and geographic reach with over 10,000 prospective franchise buyers attending.


Don't Wait Until it's too Late!

Time is running out to register for Francorp's special Franchise Expo Briefing on April 11, 2008 at the Marriott at Metro Center in Washington, DC.

The purpsose of this Franchise Expo Briefing is to review and reinforce some of the important issues you need to emphasize in working a franchise sales booth for a show.

For those of you who are interested in attending this exclusive Franchise Expo Briefing, please contact a Franchise Analyst at
800-372-6244. Don't delay! Seats are limited!


Door-To-Door Opens Seminar Doors

Door-To-Door Dry Cleaning hosted their first "Own Your Own Business" Seminar in Chicago this past month. This was the first of many seminars they plan to hold across the nation.

After viewing a demonstration performed by Francorp's CEO Don Boroian, Door-To-Door Dry Cleaning acquired the necessary tools to execute their seminar. Francorp provided a professional presentation that incorporated print advertisements, detailed visuals and the flexibility for Door-To-Door Dry Cleaning to personalize their presentation.

For those of you who are interested in enhancing lead generation and the opportunity to sell franchises through hosting your own "Own Your Own Business" Seminar, please contact khofer@francorp.com to receive a free copy of the slide show presentation.



Francorp
800.372-6244
www.Francorp.com

Francorp Clients - Door To Door Drycleaning

Francorp Client Door To Door Drycleaning is now holding "Own Your Own Business" Seminars across the United States. Door To Door is a unique business opportunity with a low start up cost and amazing revenue potential. The Dry Cleaning industry as a whole continues to grow at an amazing pace and people have less and less time in their schedules to do things like pick up the dry cleaning! Door To Door now has 30 franchisees open in just over a year and a half of franchising the operations. John Dame has a background in Software and computer systems, he has a complete operational structure set up that literally supports the Franchisees in every function of their business. His wife Joey is a marketing guru and manages the franchisees sales and marketing efforts. This is a franchise to keep an eye on, they are growing quickly and generating a great deal of interest.

Here are some posts from their website, www.mydoor.biz:

Door-To-Door Dry Cleaning is the fastest growing mobile delivery service franchise in America. We are revolutionizing a stagnate industry and changing the perception of dry cleaning. Our unique business model not only allows for you to become a part of this $11 billion dollar industry, but also shows you how to grow the most efficient and profitable business possible. Come see if you posses the qualities we are looking for to expand our rapidy growing business in your area!

At our seminar, you will learn...

-Why dry cleaning is one of the hottest sectors in business today
-How Door-To-Door Dry Cleaning is paving the way in mobile industry
-How profitable the dry cleaning industry exactly is
-How to work smarter, not harder through 4 day work weeks coupled with a home-based office


Door-To-Door Dry Cleaning

Door-To-Door Dry Cleaning
Liquid Capital Required: $34,000-$70,930
Net Worth Required: $34,000-$70,930
...with a Door-To-Door Dry Cleaning Franchise!

If you're ready to be your own boss and work 4 days a week in a home based business than a Door-to-Door Dry Cleaning franchise could be your open door to opportunity. Here's why...
As a Door-to-Door Dry Cleaning franchisee, you will work within our established, well-designed business system, backed by excellent training and support. What's more, we offer two franchise profiles - start-up and conversion - to accommodate your needs.

This remarkable opportunity offers a minimal investment requirement and low operating overhead. Operating from your home office, you will provide your timely services to both residential and business customers through the use of a leased van.

Take a few moments to discover how easy it can be to refresh your career as the owner of a Door-to-Door Dry Cleaning franchise!

Choose from Two Franchise Profiles

Start-Up Franchise - Door-to-Door Dry Cleaning offers you an exciting opportunity to provide a valuable service in the well established and growing dry cleaning industry. Only a minimal investment is required to operate your Door-to-Door Dry Cleaning Start-Up franchise. Plus, you'll enjoy low overhead with the convenience of working at home.

Conversion Franchise - Do you already own a dry cleaning establishment but would like to expand your bottom line? As a Door-to-Door Dry Cleaning franchisee, you will provide customers with the added value of convenience, time-savings, and the Door-to-Door Dry Cleaning guarantee of unparalled service. All you will need is a van and our proven business system to start growing your customer base.

Superior Franchisee Support

If you are selected to become a Door-to-Door Dry Cleaning franchisee, you will benefit from our solid support services.

Training - You will receive a combination of hands-on and classroom training, covering the areas of administration, operations, sales/marketing, and more.

Marketing Guidance - We will provide you with professionally produced marketing materials that have been field-tested for their effectiveness. Plus, you will operate under our brand and benefit from our comprehensive website and name.

Operations Manual - This extensive reference book contains everything you need to know about operating your Door-to-Door Dry Cleaning franchise.

Ongoing Support - The channels of communication will remain open as you grow in your business, and a Door-to-Door Dry Cleaning field representative will periodically visit you to offer guidance and information.

The Door is Open - Door-to-Door Dry Cleaning will be awarding a limited number of start-up and conversion franchises to individuals who believe in our brand as strongly as we do.

Look to their site at www.mydoor.biz for more information on this amazing franchise company. Also, visit www.francorp.com for more information on Door To Door.

Francorp - Franchising A Business

Francorp is often asked to describe what franchising means and what is needed for a company to become a franchise company successfully.

Franchising (from the French for honesty or freedom)is a method of doing business wherein a "franchisor" authorizes proven methods of doing business to a "franchisee" for a fee and a percentage of sales or profits. One of the most critical aspects of what Francorp does for it's clients is identify these critical numbers and business issues before putting together legal documents or selling franchises. Various tangibles and intangibles such as national or international advertising, training, and other support services are commonly made available by the franchisor, and may indeed be required by the franchisor, which generally requires audited books, and may subject the franchisee or the outlet to periodic and surprise spot checks. Failure of such tests typically involve non-renewal or cancellation of franchise rights.


The term "franchising" is used to describe business systems which may or may not fall into the legal definition provided above. For example, a vending machine operator may receive a licensing fee for a particular kind of vending machine, including a trademark and a royalty, but no method of doing business. This is called "product licensing" or "trade name franchising". Francorp will in some cases work with companies looking for expansion through licensing as opposed to Franchising.

A franchise agreement will usually specify the given territory the franchisee retains exclusive control over, as well as the extent to which the franchisee will be supported by the franchisor (e.g. training and marketing campaigns). These also are strategic issues that Francorp identifies when first beginning with a new franchise organization.

The franchisor typically earns royalties on the gross sales of the franchisee. In such cases, franchisees must pay royalties whether or not they are realizing profits from their franchised business. The royalty payments can be set with flat fees per week or month of operation, but in most cases Francorp will recommend a royalty based on gross sales.

Cancellations or terminations of franchise agreements before the completion of the contract have serious consequences for franchisees. Franchise agreement terms typically result in a loss of the sunk costs of the first-owner franchisees who build out the branded physical units and who lease the branded name, marks, and business plan from the franchisors if the franchise is cancelled or terminated for any reason before the expiration of the entire term of the contract.(Item 15 of the Rule of the Federal Trade Commission requires disclosure of terms that cover termination of the franchise agreement and the terms substantiate this statement) Francorp builds into it's agreements and contracts complete protection for the franchisor.

Franchising dates back to at least the 1850s; Isaac Singer, who made improvements to an existing model of a sewing machine, wanted to increase the distribution of his sewing machines. His effort, though unsuccessful in the long run, was among the first franchising efforts in the United States. A later example of franchising was John S. Pemberton's successful franchising of Coca-Cola. Early American examples include the telegraph system, which was operated by various railroad companies but controlled by Western Union, and exclusive agreements between automobile manufacturers and operators of local dealerships. Earlier models of product franchising collected royalties or fees on a product basis and not on the gross sales of the business operations of the franchisees. Francorp used this strategy also with John Deere as the firm converted independant dealerships into franchisees.

Modern franchising came to prominence with the rise of franchise-based food service establishments. This trend started before 1933 with quick service restaurants such as A&W Root Beer. In 1935, Howard Deering Johnson teamed up with Reginald Sprague to establish the first modern restaurant franchise. The idea was to let independent operators use the same name, food, supplies, logo and even building design in exchange for a fee.

The growth in franchises picked up steam in the 1930s when such chains as Howard Johnson's started franchising motels. The 1950s saw a boom of franchise chains in conjunction with the development of the U.S. interstate highway system. Fast food restaurants, diners and motel chains exploded. In regard to contemporary franchise chains, McDonalds is unarguably the most successful worldwide with more restaurant units than any other franchise network.

According to Franchising in the Economy, 1991-1993, a study done by the University of Louisville, franchising helped to lead America out of its economic downturn at the time. Franchising is a unique business model that has encouraged the growth of franchised chain formula units because the franchisors collect royalties on the gross sales of these units and not on the profits. Conversely, when good jobs are lost in the economy, franchising picks up because potential franchisees are looking to buy jobs and to earn profits from the purchase of franchise rights. The manager of the United States Small Business Administration's Franchise Registry concludes that franchising is continuing to grow and that franchising is growing in the national economy.

Franchising is a business model used in more than 70 industries and that generates more than $1 trillion in U.S. sales annually

Businesses for which franchises is said to works best have the following characteristics

Businesses with a good track record of profitability.
Businesses built around a unique or unusual concept.
Businesses with broad geographic appeal.
Businesses which are relatively easy to operate.
Businesses which are relatively inexpensive to operate.
Businesses which are easily duplicated.

For more detailed information on these categories attend a Francorp Franchise Your Business Seminar, it will go into much more detail on what makes a successful franchise company.

Quick start
As practiced in retailing, franchising offers franchisees the advantage of starting up a new business quickly based on a proven trademark and formula of doing business, as opposed to having to build a new business and brand from scratch (often in the face of aggressive competition from franchise operators). A well run franchise would offer a turnkey business: from site selection to lease negotiation, training, mentoring and ongoing support as well as statutory requirements and troubleshooting.


Expansion
After their brand and formula are carefully designed and properly executed, franchisors are able to expand rapidly across countries and continents, and can earn profits commensurate with their contribution to those societies. Additionally, the franchisor may choose to leverage the franchisee to build a distribution network.

Also with the help of the expertise provided by the franchisors the franchisees are able to take their franchise business to that level which they wouldn't have had been able to without the expert guidance of their franchisors.


Training
Franchisors often offer franchisees significant training, which is not available for free to individuals starting their own business. Although training is not free for franchisees, it is supported through the traditional franchise fee that the franchisor collects.


Legal aspects - Francorp is the only development firm in the world to have in-house legal staff, this is a very big reason for Francorp Client's success.

United States
In the United States, franchising falls under the jurisdiction of a number of state and federal laws. Franchisors are required by the Federal Trade Commission to provide a Uniform Franchise Offering Circular (UFOC) to disclose essential information to potential franchisees about their purchase. Francorp has three professional franchise attorneys who work very closely with the FTC to manage this process for clients at a Federal level. States may also require the UFOC to contain specific requirements but the requirements in the State disclosure documents must be in compliance with the Federal Rule that governs federal regulatory policy. There is no private right of action under the FTC Rule for franchisor violation of the rule but fifteen or more of the States have passed statutes that provide a private right of action to franchisees when fraud can be proved under these special statutes.

The franchise agreement is a standard part of franchising. It is the essential contract signed by the franchisee and the franchisor that formalizes and specifies the terms of the business arrangement, as well as many issues discussed in less detail in the UFOC. Unlike the UFOC, the franchise agreement is a fluid document, crafted to meet the specific needs of the franchise, with each having its own set of standards and requirements. But much like a lease, there are elements commonly found in every agreement. "There is a difference between a discrete contract and a relational contract, and franchise contracts are a distinct subset of relational contracts." Franchise contracts form a unique and ongoing relationship berween the parties. "Unlike a traditional contract, franchise contracts establish a relationship where the stronger party can unilaterally alter the fundamental nature of the obligations of the weaker party......." The critical aspect of this is that the legal work that pertains to franchise development is very unique and must be carefully followed, there are very few firms that have the expertise and ability to work with clients through this process like Francorp.

There is no federal registry of franchises or any federal filing requirements for information. States are the primary collectors of data on franchising companies, and enforce laws and regulations regarding their presence and their spread in their jurisdictions. In response to the soaring popularity of franchising, an increasing number of communities are taking steps to limit these chain businesses and reduce displacement of independent businesses through limits on "formula businesses."

The majority of franchisors have inserted mandatory arbitration clauses into their agreements with their franchisees. Since 1980, the U.S. Supreme Court has dealt with cases involving direct franchisor/franchisee conflicts at least four times, and three of those cases involved a franchisee who was resisting the franchisor's motion to compel arbitration. Two of the latter cases involved large, well-known restaurant chains (Burger King in Burger King v. Rudzewicz and Subway in 517 US 681 (1996) Doctor's Associates, Inc. v. Casarotto); the third involved Southland Corporation, the parent company of 7-Eleven in Southland Corp. v. Keating, 465 US 1 (1984).


Russia
In Russia, under ch. 54 of the Civil Code (passed 1996), franchise agreements are invalid unless written and registered, and franchisors cannot set standards or limits on the prices of the franchisee’s goods. Enforcement of laws and resolution of contractual disputes is a problem: Dunkin' Donuts chose to terminate its contract with Russian franchisees that were selling vodka and meat patties contrary to their contracts, rather than pursue legal remedies.


UK
In the United Kingdom, there are no franchise-specific laws; franchises are subject to the same laws that govern other businesses. For example, franchise agreements are produced under regular contract law and do not have to conform to any further legislation or guidelines. There is some self-regulation through the British Franchise Association (BFA). However there are many franchise businesses which do not become members, and many businesses that refer to themselves as franchisors that do not conform to these rules. There are several people and organisations in the industry calling for the creation of a framework to help reduce the number of "cowboy" franchises and help the industry clean up its image.

On 22 May 2007, hearings were held in the UK Parliament concerning citizen initiated petitions for special regulation of franchising by the government of the UK due to losses of citizens who had invested in franchises. The Minister of Industry, Margaret Hodge, conducted hearings but resisted any government regulation of franchising with the advice that government regulation of franchising might lull the public into a false sense of security. The Minister of Industry indicated that if due diligence were performed by the investors and the banks, the current laws governing business contracts in the UK offered sufficient protection for the public and the banks.


Kazakhstan - Francorp has several offices in the Middle East
Until 2002, franchising rules in Kazakhstan were also governed by Chapter 45 of the Kazakh Civil Code (CC). Measures of state support franchising generally been included in the programme of support for business. Measures to promote franchising were provided in paragraph 2.4.1 of the state program for small business development and support for the 1999–2000. Key provisions of Chapter 45, as well as the rules governing the franchise in more detail relations, entered the law "About integrated business license (franchise)", dated 24 June 2002, No. 330 - II. It should be noted that amongst the Commonwealth of Independent States, Kazakhstan is one of the first countries to introduce the legal definition of franchising in a special law.


Social franchises
In recent years, the idea of franchising has been picked up by the social enterprise sector, which hopes to simplify and expedite the process of setting up new businesses. A number of business ideas, such as soap making, wholefood retailing, aquarium maintenance, and hotel operation, have been identified as suitable for adoption by social firms employing disabled and disadvantaged people.

The most successful example is probably the CAP Markets, a steadily growing chain of some 50 neighborhood supermarkets in Germany. Other examples are the St. Mary's Place Hotel in Edinburgh and the Hotel Tritone in Trieste.

Event franchising
Event franchising is the duplication of public events in other geographical areas, while retaining the original brand (logo), mission, concept and format of the event.[21] As in classic franchising, event franchising is built on precisely copying successful events. Good example of event franchising is the World Economic Forum, or just Davos forum which has regional event franchisees in China, Latin America etc.

Visit Francorp's site, www.francorp.com for more insight into the history of franchising and franchising as an expansion tool.

You can also interact with and see what Francorp clients have to say about the firm at http://www.francorp1.com/

Francorp - Franchising A Business

Francorp is often asked to describe what franchising means and what is needed for a company to become a franchise company successfully.

Franchising (from the French for honesty or freedom)is a method of doing business wherein a "franchisor" authorizes proven methods of doing business to a "franchisee" for a fee and a percentage of sales or profits. One of the most critical aspects of what Francorp does for it's clients is identify these critical numbers and business issues before putting together legal documents or selling franchises. Various tangibles and intangibles such as national or international advertising, training, and other support services are commonly made available by the franchisor, and may indeed be required by the franchisor, which generally requires audited books, and may subject the franchisee or the outlet to periodic and surprise spot checks. Failure of such tests typically involve non-renewal or cancellation of franchise rights.


The term "franchising" is used to describe business systems which may or may not fall into the legal definition provided above. For example, a vending machine operator may receive a licensing fee for a particular kind of vending machine, including a trademark and a royalty, but no method of doing business. This is called "product licensing" or "trade name franchising". Francorp will in some cases work with companies looking for expansion through licensing as opposed to Franchising.

A franchise agreement will usually specify the given territory the franchisee retains exclusive control over, as well as the extent to which the franchisee will be supported by the franchisor (e.g. training and marketing campaigns). These also are strategic issues that Francorp identifies when first beginning with a new franchise organization.

The franchisor typically earns royalties on the gross sales of the franchisee. In such cases, franchisees must pay royalties whether or not they are realizing profits from their franchised business. The royalty payments can be set with flat fees per week or month of operation, but in most cases Francorp will recommend a royalty based on gross sales.

Cancellations or terminations of franchise agreements before the completion of the contract have serious consequences for franchisees. Franchise agreement terms typically result in a loss of the sunk costs of the first-owner franchisees who build out the branded physical units and who lease the branded name, marks, and business plan from the franchisors if the franchise is cancelled or terminated for any reason before the expiration of the entire term of the contract.(Item 15 of the Rule of the Federal Trade Commission requires disclosure of terms that cover termination of the franchise agreement and the terms substantiate this statement) Francorp builds into it's agreements and contracts complete protection for the franchisor.

Franchising dates back to at least the 1850s; Isaac Singer, who made improvements to an existing model of a sewing machine, wanted to increase the distribution of his sewing machines. His effort, though unsuccessful in the long run, was among the first franchising efforts in the United States. A later example of franchising was John S. Pemberton's successful franchising of Coca-Cola. Early American examples include the telegraph system, which was operated by various railroad companies but controlled by Western Union, and exclusive agreements between automobile manufacturers and operators of local dealerships. Earlier models of product franchising collected royalties or fees on a product basis and not on the gross sales of the business operations of the franchisees. Francorp used this strategy also with John Deere as the firm converted independant dealerships into franchisees.

Modern franchising came to prominence with the rise of franchise-based food service establishments. This trend started before 1933 with quick service restaurants such as A&W Root Beer. In 1935, Howard Deering Johnson teamed up with Reginald Sprague to establish the first modern restaurant franchise. The idea was to let independent operators use the same name, food, supplies, logo and even building design in exchange for a fee.

The growth in franchises picked up steam in the 1930s when such chains as Howard Johnson's started franchising motels. The 1950s saw a boom of franchise chains in conjunction with the development of the U.S. interstate highway system. Fast food restaurants, diners and motel chains exploded. In regard to contemporary franchise chains, McDonalds is unarguably the most successful worldwide with more restaurant units than any other franchise network.

According to Franchising in the Economy, 1991-1993, a study done by the University of Louisville, franchising helped to lead America out of its economic downturn at the time. Franchising is a unique business model that has encouraged the growth of franchised chain formula units because the franchisors collect royalties on the gross sales of these units and not on the profits. Conversely, when good jobs are lost in the economy, franchising picks up because potential franchisees are looking to buy jobs and to earn profits from the purchase of franchise rights. The manager of the United States Small Business Administration's Franchise Registry concludes that franchising is continuing to grow and that franchising is growing in the national economy.

Franchising is a business model used in more than 70 industries and that generates more than $1 trillion in U.S. sales annually

Businesses for which franchises is said to works best have the following characteristics

Businesses with a good track record of profitability.
Businesses built around a unique or unusual concept.
Businesses with broad geographic appeal.
Businesses which are relatively easy to operate.
Businesses which are relatively inexpensive to operate.
Businesses which are easily duplicated.

For more detailed information on these categories attend a Francorp Franchise Your Business Seminar, it will go into much more detail on what makes a successful franchise company.

Quick start
As practiced in retailing, franchising offers franchisees the advantage of starting up a new business quickly based on a proven trademark and formula of doing business, as opposed to having to build a new business and brand from scratch (often in the face of aggressive competition from franchise operators). A well run franchise would offer a turnkey business: from site selection to lease negotiation, training, mentoring and ongoing support as well as statutory requirements and troubleshooting.


Expansion
After their brand and formula are carefully designed and properly executed, franchisors are able to expand rapidly across countries and continents, and can earn profits commensurate with their contribution to those societies. Additionally, the franchisor may choose to leverage the franchisee to build a distribution network.

Also with the help of the expertise provided by the franchisors the franchisees are able to take their franchise business to that level which they wouldn't have had been able to without the expert guidance of their franchisors.


Training
Franchisors often offer franchisees significant training, which is not available for free to individuals starting their own business. Although training is not free for franchisees, it is supported through the traditional franchise fee that the franchisor collects.


Legal aspects - Francorp is the only development firm in the world to have in-house legal staff, this is a very big reason for Francorp Client's success.

United States
In the United States, franchising falls under the jurisdiction of a number of state and federal laws. Franchisors are required by the Federal Trade Commission to provide a Uniform Franchise Offering Circular (UFOC) to disclose essential information to potential franchisees about their purchase. Francorp has three professional franchise attorneys who work very closely with the FTC to manage this process for clients at a Federal level. States may also require the UFOC to contain specific requirements but the requirements in the State disclosure documents must be in compliance with the Federal Rule that governs federal regulatory policy. There is no private right of action under the FTC Rule for franchisor violation of the rule but fifteen or more of the States have passed statutes that provide a private right of action to franchisees when fraud can be proved under these special statutes.

The franchise agreement is a standard part of franchising. It is the essential contract signed by the franchisee and the franchisor that formalizes and specifies the terms of the business arrangement, as well as many issues discussed in less detail in the UFOC. Unlike the UFOC, the franchise agreement is a fluid document, crafted to meet the specific needs of the franchise, with each having its own set of standards and requirements. But much like a lease, there are elements commonly found in every agreement. "There is a difference between a discrete contract and a relational contract, and franchise contracts are a distinct subset of relational contracts." Franchise contracts form a unique and ongoing relationship berween the parties. "Unlike a traditional contract, franchise contracts establish a relationship where the stronger party can unilaterally alter the fundamental nature of the obligations of the weaker party......." The critical aspect of this is that the legal work that pertains to franchise development is very unique and must be carefully followed, there are very few firms that have the expertise and ability to work with clients through this process like Francorp.

There is no federal registry of franchises or any federal filing requirements for information. States are the primary collectors of data on franchising companies, and enforce laws and regulations regarding their presence and their spread in their jurisdictions. In response to the soaring popularity of franchising, an increasing number of communities are taking steps to limit these chain businesses and reduce displacement of independent businesses through limits on "formula businesses."

The majority of franchisors have inserted mandatory arbitration clauses into their agreements with their franchisees. Since 1980, the U.S. Supreme Court has dealt with cases involving direct franchisor/franchisee conflicts at least four times, and three of those cases involved a franchisee who was resisting the franchisor's motion to compel arbitration. Two of the latter cases involved large, well-known restaurant chains (Burger King in Burger King v. Rudzewicz and Subway in 517 US 681 (1996) Doctor's Associates, Inc. v. Casarotto); the third involved Southland Corporation, the parent company of 7-Eleven in Southland Corp. v. Keating, 465 US 1 (1984).


Russia
In Russia, under ch. 54 of the Civil Code (passed 1996), franchise agreements are invalid unless written and registered, and franchisors cannot set standards or limits on the prices of the franchisee’s goods. Enforcement of laws and resolution of contractual disputes is a problem: Dunkin' Donuts chose to terminate its contract with Russian franchisees that were selling vodka and meat patties contrary to their contracts, rather than pursue legal remedies.


UK
In the United Kingdom, there are no franchise-specific laws; franchises are subject to the same laws that govern other businesses. For example, franchise agreements are produced under regular contract law and do not have to conform to any further legislation or guidelines. There is some self-regulation through the British Franchise Association (BFA). However there are many franchise businesses which do not become members, and many businesses that refer to themselves as franchisors that do not conform to these rules. There are several people and organisations in the industry calling for the creation of a framework to help reduce the number of "cowboy" franchises and help the industry clean up its image.

On 22 May 2007, hearings were held in the UK Parliament concerning citizen initiated petitions for special regulation of franchising by the government of the UK due to losses of citizens who had invested in franchises. The Minister of Industry, Margaret Hodge, conducted hearings but resisted any government regulation of franchising with the advice that government regulation of franchising might lull the public into a false sense of security. The Minister of Industry indicated that if due diligence were performed by the investors and the banks, the current laws governing business contracts in the UK offered sufficient protection for the public and the banks.


Kazakhstan - Francorp has several offices in the Middle East
Until 2002, franchising rules in Kazakhstan were also governed by Chapter 45 of the Kazakh Civil Code (CC). Measures of state support franchising generally been included in the programme of support for business. Measures to promote franchising were provided in paragraph 2.4.1 of the state program for small business development and support for the 1999–2000. Key provisions of Chapter 45, as well as the rules governing the franchise in more detail relations, entered the law "About integrated business license (franchise)", dated 24 June 2002, No. 330 - II. It should be noted that amongst the Commonwealth of Independent States, Kazakhstan is one of the first countries to introduce the legal definition of franchising in a special law.


Social franchises
In recent years, the idea of franchising has been picked up by the social enterprise sector, which hopes to simplify and expedite the process of setting up new businesses. A number of business ideas, such as soap making, wholefood retailing, aquarium maintenance, and hotel operation, have been identified as suitable for adoption by social firms employing disabled and disadvantaged people.

The most successful example is probably the CAP Markets, a steadily growing chain of some 50 neighborhood supermarkets in Germany. Other examples are the St. Mary's Place Hotel in Edinburgh and the Hotel Tritone in Trieste.

Event franchising
Event franchising is the duplication of public events in other geographical areas, while retaining the original brand (logo), mission, concept and format of the event.[21] As in classic franchising, event franchising is built on precisely copying successful events. Good example of event franchising is the World Economic Forum, or just Davos forum which has regional event franchisees in China, Latin America etc.

Visit Francorp's site, www.francorp.com for more insight into the history of franchising and franchising as an expansion tool.

Franchising A Business

Franchising a business takes a great deal of planning and structure. In order to do this effectively one must have the correct structure, training systems and commitment to effectively grow a franchise organization. This is only possible by bringing in the right people, professionals and experienced staff. Francorp is a professional organization of franchise consultants built on the principals that make businesses successful. Please visit Francorp's site, http://www.francorp.com/ for more information, details and insight into what has make the firm the most productive and successful franchise organization in the world.

You can also interact with and see what Francorp clients have to say about the firm at http://www.francorp1.com/