They say # 1000-mile walk starts with a step, the question is is there a shortcut?<\/p>\n
A project to start and from the first day to order by name?<\/p>\n
Yes, this type of project is called franchise or franchise.<\/p>\n
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At first, what are the patterns of commercial expansion across others?<\/p>\n
1\/Expansion is through branches.<\/p>\n
2\/or expansion through franchise, which is the focus of our conversation.<\/p>\n
<\/p>\n
Franchise:<\/p>\n
is the completion of the success of an enterprise, defined as a contract between two parties on the basis of which the first party called the grantor grants the second party called the concessionaire consent to the use of one or more intellectual, industrial or knowledge property rights to produce a commodity, distribute a product or provide a service under a trademark produced by the first party, This consent is based on a specific geographical area and a given time at a material rate paid by the second party to the first party.<\/p>\n
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Example:<\/p>\n
Khalid has a restaurant and the food he offers her a secret recipe made the restaurant different and desirable from customers This made him a great success and his sales became high, but his branches are only in Paris. “Mohammed has come and proposed to Khalid. This proposal will help Khalid expand his branches in Saudi cities so that Mohammed opens branches in many cities in exchange for that Khalid grants him the franchise of this brand and informs him in the confidential recipe until he uses it in the new branches. These branches shall be under the umbrella of Khalid’s main branches for a material payment by Mohammed.<\/p>\n
The difference between the Agency and the franchise:<\/p>\n
Franchise has proven to be one of the most important ways of doing business in today’s world, especially for SMEs, and grants the right to use the brand. Franchise provides management expertise, technical and technical support, continuous marketing, mandatory training and franchised goods and services, providing the grantor with business models for the exercise of franchise activity. While the Agency grants the right to sell the product, distribute and license using the label, it may provide some limited support.<\/p>\n
Are franchising conditions?<\/p>\n
Yes, there are two cases:<\/p>\n
Franchise Advantage:<\/p>\n
1\/Fast growth.<\/p>\n
2\/Lower risk.<\/p>\n
3\/Competitiveness.<\/p>\n
<\/p>\n
The franchise system was promulgated in 2019. To safeguard the rights of all parties and define the relationship to assist in the mutual success of the parties, which aims to create promising opportunities for those wishing to invest in the franchise system by regulating the relationship between the franchisor and the grantor in order to ensure harmony and harmony between them, help the rapid expansion and spread in the markets at lower risk, contribute to the growth of the time economy and stimulate companies.<\/p>\n
Text of the Regulations:<\/p>\n
https:\/\/laws.boe.gov.sa\/BoeLaws\/Laws\/LawDetails\/af2a6b93-51dd-4f16-b781-aafd00d9fbbc\/1#<\/a><\/p>\n <\/p>\n What the grantor should have before granting:<\/p>\n First, his trademark must be legally protected not only at the local level, but also best at the global level.<\/p>\n Second, the product is required.<\/p>\n Thirdly, all procedures and operational evidence are processed through, for example, the presentation process, recipes, layout, display process, internal product identity design, services provided by the product from delivery and others.<\/p>\n After the system has been completed in terms of procedures, the task force has been saturated and they are able to work in it, the supply chain has been equipped, the pumping and investment process comes with marketing, and the donor then proceeds with the grants.<\/p>\n <\/p>\n What does the grantor provide to the grantor?<\/p>\n 1 Training and guidance.<\/p>\n 2\/Setting standards and specifications for products and services provided.<\/p>\n 3\/Follow-up and ongoing technical support.<\/p>\n 4\/Developing services and products.<\/p>\n What does the donor provide?<\/p>\n 1\/Implementation of the grantor’s directives and application of its criteria.<\/p>\n 2\/Operation of the activity.<\/p>\n 3\/Introducing obstacles at work and end-consumer proposals.<\/p>\n 4\/Expansion and proliferation.<\/p>\n Types of franchise depending on the style and method of regulation:<\/p>\n 1\/Direct concession:<\/p>\n This method is the easiest and most widespread in the world. Through the contract between the donor and the beneficiary, the points it provides are included and benefit both parties. By this contract, the grantor is responsible for determining the requirements and conditions that support the company’s management mechanism and its new branches well.<\/p>\n 2\/Main concession (Master):<\/p>\n A contract is signed between the donor and the beneficiary. The concessionaire grants an exclusive concession in an area to the beneficiary, where the concession is to use an integrated package of project management and operation as best as possible in the region.<\/p>\n 3\/Excellence for the development of the region:<\/p>\n Here the concession contract is with a person or company to search within a geographical target area for the entities and companies nominated for the company’s franchise.<\/p>\n This privilege does not give this person any right or scope to contract and conclude legal contracts for the concession, but rather is a link between the grantor and the beneficiary.<\/p>\n 4\/Multiple Unit Concession:<\/p>\n The donor grants the concession of multiple units in an area to several projects, shops and branches. In this case, the agreement is general. The concessionaire here cannot use the trademark or any technical knowledge in general, but each individual or company has an individual contract that allows each of them to obtain unique concessions.<\/p>\n Each method governs a specific capital.<\/p>\n Each donor company with initial fees pays once and often starts from SAR 20 thousand to SAR 4 million.<\/p>\n It increases and decreases according to each company<\/p>\n Foreign companies often have lower fees but compel the grantor to purchase all materials from them.<\/p>\n <\/p>\n Trade excellence has contributed significantly to the development of countries’ economy by raising GDP and creating new jobs It contributed 4% to 5% of the world’s GDP, which is regarded as rapidly growing compared to economic growth. Every 2 million franchises globally creates an estimated 19 million career opportunities Franchise jobs account for 6% of private sector jobs in developed countries in the application of franchise.<\/p>\n <\/p>\n At the level of the Kingdom, the General Authority for Small and Medium Enterprises (GSME) has taken an interest in franchising and has launched an initiative<\/p>\n Franchise Center Link:<\/p>\n https:\/\/emtiyaz.sa\/<\/a><\/p>\n <\/p>\n Franchisee’s portfolio:<\/p>\n\n