The Full Circle Franchise Process

If you look back, historically, at how the business environment in the United States has evolved, you will see that most early businesses were actually "Mom and Pop" individually owned operations. The drug and grocery stores, the retail clothing and apparel operations, the accounting and legal firms, the gasoline and service stations all were locally owned and operated by self-employed entrepreneurs who typically started the business themselves.

Everything was fine and everyone basically prospered, until the early 1940's and 1950's when a whole new era of business occurred. The "chainstore" concept emerged and began to penetrate local markets which were once dominated by the small businessperson.

This independent entrepreneur, because of the massive size and power of the "chain," found it increasingly difficult to co-exist. They simply couldn't compete against the buying power, advertising dollars and capitalization of the chains, and were in essence, forced out of business and they ultimately closed their doors.

The chains existed and, in most cases, dominated many industries, even businesses in local markets, until the late 1960's, 70's and into the 80's. Today, however, these "chains" face daunting challenges:

• deregulation in certain industries,
  
• increasing labor and employee costs,
  
• the growing competitive environment,
  
• increases in real estate and construction costs,
  
• and many other areas of increased expenses related to conducting their businesses.

The most logical and effective method of expansion has became the franchising relationship. Ironically, the lifeblood for these companies has again become the "entrepreneurs" or the "Mom and Pop's." No longer "forced" out of business by the power of the chains, the "Mom and Pop's" are participating in and taking advantage of the power and capabilities of the chains. Further, as statistics show, the entrepreneur who owns his/her own business is more likely to work longer and harder to make the business a success.

So, as the story evolves, the "chains," in an effort to penetrate new markets and still maintain the consistency and uniformity in the minds of the consumer, began offering the entrepreneur or "Mom and Pops" all of the benefits that the chain has to offer:

• collective advertising,
  
• combined purchasing power,
  
• marketing techniques,
  
• operational experiences, tools, controls and procedures,
  
• name awareness, and most important,

These "tried and tested" businesses became the "prototypes" for the franchising process.

So what occurred, in essence, is the "full circle" concept of business which brings together the best of both worlds. The strength, power and experience of the chain and the proprietorship and dedication of the elf-employed entrepreneur.