Franchising refers to trademarks (including service trademarks), trade names, products, patents and proprietary technologies, business models, etc. granted by franchisers. The franchisee is awarded in the form of franchise contract, and the franchisee engages in business activities under the unified business model of the franchisor according to the provisions of the contract, and pays the corresponding expenses to the franchisor. Obviously, franchising is a license of business skills and business forms, and it is the grant of software technology, that is, intellectual property rights. Not limited by funds, regions, time, etc. At the same time, we can develop more than one company and expand rapidly in any area with consumer groups with the characteristics of low cost and small risk.
Nowadays, franchising, as the globalization and internationalization trend of business development, is developing rapidly with strong momentum. In recent years, more than half of the total retail sales in the United States have been realized through franchising. A franchise store opens every eight minutes, with a success rate of 95%, which is several times higher than other business models. In Japan, Singapore and other Asian countries, the development momentum of franchising is also very strong. Although franchising has not developed for a long time in China, it has developed rapidly. Its development status and characteristics are:
1. has developed rapidly and expanded in scale, becoming the growth point of national economic development. According to the statistics of the Domestic Trade Bureau, by the end of 1999, the total number of chain enterprises in the domestic trade system had reached more than 1800, with 26,000 chain stores, with a business volume of150 billion yuan, accounting for about 5% of the total retail sales of social consumer goods. According to the statistics of relevant departments, 1997 has 95 franchised enterprises that operate supermarkets and convenience stores in the mainstream format, with sales of more than 0 billion yuan, an increase of 1.6 times over the previous year, and 755 outlets, an increase of 3.7 times over the previous year. Franchised enterprises account for 36% of the total number of chain enterprises. According to this calculation, there are about 600 enterprises in various industries in China, with about 5,000 outlets and an annual turnover of about 50 billion yuan. In recent years, the sales realized by chain operation have increased by more than 40% annually, which greatly exceeds the national growth rate of consumer goods by about 10% or about 30 percentage points.
2. Franchise chain operation expands to multi-format and multi-industry fields. From the format point of view, supermarkets and convenience stores are the mainstay, and they are developing into specialty stores, boutiques and warehouse-style shopping malls. From the perspective of industry, they have expanded from retail industry to catering and means of production, from tangible commodity management to service management, covering almost all industries such as commerce and service industry. For example, Beijing Quanjude Roast Duck Restaurant has 60 franchisees. At present, franchising in China has developed into books, dyeing, expansion, car rental, maintenance, domestic service, fitness and entertainment, hairdressing and beauty.
3. New advanced management technologies, promotion strategies and management methods are widely used in franchising. Franchising has broken the traditional business model and the relationship between industry and commerce, agriculture and commerce, wholesale and retail. Based on the principle of "* * learning a technology, * * making a product, * * enjoying a brand and * * reaping huge profits", its management mode has undergone fundamental changes. In particular, a number of famous brand stores, led by manufacturers, joined agents and adopted the franchise model, have formed a chain operation network all over the country.
Franchising has become the main means of enterprise expansion. Many chain enterprises began to extend from the city to the periphery through franchising when the urban market was relatively saturated. In the more developed areas such as Yangtze River Delta, Pearl River Delta and Jiaodong Peninsula, more than half of the stores of some chain enterprises are located in towns and villages below the county level, such as Shanghai Lianhua Supermarket, Shanghai Hualian Supermarket, Guangdong Dongguan Meijia Supermarket and Shandong Jikelong. Most of these enterprises expand to the surrounding areas through franchising, using their own goodwill, business technology and commodity procurement advantages. For example, there is one in Rudong, Jiangsu Province, which used to be a loss-making shopping mall. After joining Hualian Supermarket, the sales amount reached 500,000-600,000 yuan and the monthly profit was more than 20,000 yuan. The salary of employees increased from 200-300 yuan to 800- 1000 yuan. After joining Hualian Supermarket, the enthusiasm of employees was obviously improved.
5. Franchising has developed from a single state-owned economy to a diversified business entity. In terms of ownership, state-owned circulation enterprises are the main force of chain operation, and the chain enterprises of collective, private, joint-stock and foreign capital have accelerated their development, forming a diversified pattern in which state-owned commercial enterprises are the mainstay and collective, private and foreign-funded enterprises participate together. Among 93 enterprises, limited companies account for 49% and wholly state-owned enterprises account for 465,438+0%, forming a market pattern of cooperation, competition and coexistence between domestic and foreign enterprises in the field of chain operation.
6. The government's promotion and policy support have promoted and protected franchising. The promotion of government power is the characteristic of chain development, and it also provides a big environment for the rapid development of chain business model.
1. The scale of franchise. The vitality of chain operation lies in reducing costs and expanding market share by improving the organization and scale of enterprises. In recent years, the number of chain enterprises in China has been expanding slowly, but the store development of each chain enterprise is very uneven, and the store size of many chain enterprises can not reach the internationally recognized profit and loss point of chain enterprises (14 or more). At present, the scale of domestic chain operation is small. On average, a chain enterprise has only 14 stores, and many chain enterprises have only three or four stores. According to statistics, Hong Kong has a population of five or six million, and only four or five supermarket chain companies control more than 1000 chain outlets, with an average of more than 200 each company. China is not like this. Take Guangzhou as an example. There are 25 chain enterprises in the city, with an average of 6. According to statistics, at present, the proportion of the total number of chain enterprises with sales exceeding 100 million yuan in China is less than 5%, forming a situation that each chain enterprise has its own stores, and it is difficult for each family to develop more stores, but it is difficult for chain stores to blossom everywhere.
2. Standardization of franchise chain operation. At present, the phenomenon of irregular chain operation in China is widespread, mainly in three aspects: First, the development is irregular. In recent years, under the inducement of preferential policies and the hype of the media, there has been an upsurge. The development of chain operation requires certain objective conditions. Second, the operation is not standardized. The network development, market positioning and business scope of chain enterprises must be determined according to the principles of minimizing risks and maximizing benefits. At present, the network layout is unreasonable and the market positioning is super-equivalent. Third, the management is not standardized. According to international practice, the unified distribution rate of chain operation should reach more than 80%, but at present, the proportion of unified procurement and unified distribution of most chain enterprises in China is only 30%-60%. Many chain stores, noodle chains or single-store operations, fragmented. Some stores just unified the store name, clothing and logo, but the core of the chain: unified procurement and unified distribution has not been completed so far, and unified accounting and management are out of the question.
3. The impact of internationalization of franchising on China. When the chain operation in China just grew up, some international super chain enterprises entered China in succession, using joint ventures and cooperation. China market is occupied by export management, which constitutes the competitive pressure of chain operation in China. Such as McDonald's, KFC and Pizza Hut, which are the world's catering giants, have entered one after another, and their chain stores are all over large and medium-sized cities in China. By June 1996, three catering giants had opened stores in China: KFC reached 100, McDonald's 62 and Pizza Hut 27. At the same time, international chain stores have also rushed to the beach. Wal-Mart in the United States, Kmart in France, Carrefour in France, Jiashike in Japan, Dai Rong, Seibu, Markro in the Netherlands and Metro in Germany are all infiltrating into the China market. China is about to join the WTO, and the international situation of this chain industry competition will become increasingly clear.
4. The development speed and benefit of franchise chain operation. With the development of chain operation, some mature chain enterprises, especially catering industry and fashion specialty stores, have accelerated their development. Beijing Quanjude Roast Duck Restaurant, Tianjin Goubuli Steamed Bun Shop and Beijing Pierre Cardin Fashion Company all adopted the franchise mode, and some large retail enterprises also adopted the franchise mode to develop their branches in the development process to expand their scale. However, the scale expansion of chain enterprises should be based on benefit expansion, which is an economic model of reducing unit cost and increasing income on a large scale. Therefore, the large number of shops sold by an enterprise does not completely equal the income. If the benefits decrease with the expansion of the scale, then the scale will be uneconomical, and even losses and bankruptcies will occur. For example, in addition to management reasons, the closure of Beijing Red Apple was mainly due to the blind proposal to develop 100 chain stores in a short time, which eventually led to insufficient funds to pay the suppliers.
5. Brand, trade name and management technology. Brand, enterprise and management technology are the core and soul of franchising. Without a well-known brand, a reputable firm, a strong management system and management technology, franchising can't be done well. Recently, when the media reminded people not to fall into the trap, it was revealed that some unscrupulous businessmen cheated money under the signboard of franchising without any brand and management technology. This is worthy of our vigilance.
6. The system and legislation of further development of franchising. The institutional constraints are: first, the fragmented system limits the development scale of franchising. This not only leads to vicious competition in the same region, but also fails to achieve economies of scale. Second, enterprises lack the expansion motivation for development. The current enterprise system and operating mechanism have bound the internal motivation of enterprise self-development. Third, the logistics environment is difficult to ensure the technical essentials of unified distribution of chain stores. At the same time, establishing and perfecting laws and regulations related to franchising and creating a good legal environment are the prerequisites to ensure the healthy development of franchising.
Although the development of franchising in China started late, there are also some restrictive and unfavorable factors. However, its development prospects are promising, showing a rapid growth trend and favorable development. The main manifestations are as follows: First, domestic chains started with direct chain, and the practice of direct chain provided valuable experience for franchise chains; Second, the private economy has become the most active component in China's economy. State-owned commercial capital will gradually withdraw from commerce and service industry, which provides a broad space for individuals and private investment; Fourth, service consumption has become a new hot spot, and the service market presents huge consumption potential, which is a huge market for franchise development; 5. Encouraged by the state and supported by policies and laws. Judging from the development of international chain stores, when direct chain stores develop to a certain scale and form their own brands and formed management software, they will generally turn to franchising to expand the market. Under the condition of modern society, franchising is a way to absorb social capital in a wider range and expand the scale of operation at a low cost, which is particularly attractive to the development of small and medium-sized enterprises. Therefore, franchising is bound to become the most potential form of chain operation.
1. Franchising has become an economic growth point for expanding domestic demand and opening up markets in China. Naisbitt called franchising "the most important commercial operation form in 2 1 century". Chain operation has huge development space and market potential, and broad development prospects. The turnover of chain stores in the world has accounted for 40-50% of the total retail sales of consumer goods in the whole society, while that of China is only 2% and that of Shanghai is only 12%. At present, franchising has played a positive role in promoting the development of China's supermarket chains and time-honored catering chain enterprises. Franchising is being fully popularized, and a number of franchising methods have emerged in service industries such as automobile sales, dry cleaning, medical care, domestic service and beauty salons. For example, the "Malan Lamian Noodles Wanjia Chain Project" of Lanzhou Malan Lamian Noodles Fast Food Co., Ltd. plans to establish 20,000 chains to join Malan in less than 10 years. After nearly a year of hard work. "Malan Lamian Noodles Wanjia Chain Project" has achieved initial results. The company has established more than 50 direct stores in Beijing, Shanghai and other places, and established more than 9,300 franchise stores nationwide. The store operates well and has achieved remarkable economic benefits.
2. Franchising will be the main content of the development of chain operation. The forms of chain operation are usually divided into direct chain, voluntary chain and franchise chain. Generally speaking, franchise chain is superior to the other two chain forms, so it is easier to be adopted by enterprises in their development. According to incomplete statistics, business in franchise development takes a short time. Among them, 46% of the franchised enterprises can start franchising within one year, and 60% of the franchised enterprises can start franchising within 1-2 months, with the shortest operation time of 15 days and the longest operation time of 180 days. In a word, franchising not only concentrates the strong control power of the headquarters of direct chain (regular chain) and the advantages of independent capital, management ability and management enthusiasm of free chain, but also sells successful brands and complete sets of management skills to franchisees through contracts to ensure franchisees' monopoly rights in a certain area. Therefore, many enterprises turn to franchising after they have developed to a certain scale. For example, Rongchang Laundry, founded in 1990, is a chain enterprise engaged in clothes cleaning, maintenance, sales of equipment and chemical raw materials. There are 25 chain stores in Beijing alone. In order to seek greater development, we have made a franchise choice, and plan to open Rongchang washing and dyeing chain stores to 65,438+000 in Beijing and 65,438+0000 in China within two years.
3. The vast countryside is the development space of franchise chain operation. To open up the market, the key point is to open up the rural market. From the perspective of market space, the chain operation in the vast rural market is basically blank, which provides a broad space for the development of chain operation. With the development of chain operation, some enterprises extend their retail and service networks from central cities to small and medium-sized cities, and develop them to counties and market towns in economically developed areas, which is also the focus of future retail operation. The expansion of chain enterprises to surrounding areas, especially rural markets, has purified rural markets, met the needs of rural consumers, promoted the development of local retail industry and found new growth points for enterprises. For example, 365,438+0 of the 38 stores in Guangdong Dongmei Meijia Supermarket opened in rural areas, and1more than 84% of the sales in the first half of 1998 came from township stores. Practice has proved that franchising has broad development prospects in rural areas.
4. The technological content of franchise chain operation will be further improved. With the development of chain operation, the technological innovation of chain enterprises in China will reach a new level in the future, and at the same time, it also puts forward higher requirements for supporting the society. Computer, network technology, bar code, refrigeration technology, e-commerce, logistics and distribution are all technical supports for the further development of chain operation.
Franchise chain operation will be further opened to the outside world. After China's entry into WTO, it promised to liberalize franchising and no longer restrict it. This not only provides conditions for foreign franchised enterprises to directly enter the domestic market, but also provides opportunities for China franchised enterprises to enter the international market. Accelerating the integration of franchising in China with the international market has laid a good foundation for the development of franchising management mode with China characteristics, and also brought new opportunities for the development of franchising in China.