Get to Know What is Franchise?

In English, franchising is called franchising. Franchising is a system for distributing goods and services to end customers with the franchisor who gives the right to an individual or company to conduct business with a brand, name, system, Standard Operating Standards and Procedures (SOP), and methods that have been previously determined within a period of time. certain covers a specific area. The owner of a brand or business that gives franchise rights is called a franchisor, while a buyer or franchisee is called a franchisee.

In order to be easily understood by UKM friends, we will discuss it using an example. Mr. Dilan has a business in the form of Umrah and Hajj souvenirs called Alif Kurma n Friends (pseudonym). This business has been around for 5 years. Pak Dilan wants to develop the business he has started with a franchise scheme. Mr. Dilan sells franchise packages containing trademarks, products for 1 initial delivery cycle, and management procedures for IDR 35,000,000.

Ms. Milea, who heard the information, was interested and finally bought the Alif Kurma n Friends franchise because she has a shop building that is not being used productively. The word consensus has also been obtained from all parties. Ms. Milea has officially received the right to open an Umrah and Hajj gift shop under the name Alif Kurma n Friends gets a supply of dates and other variants from Mr. Dilan, as well as procedures or SOPs for running the business, complete with training capable human resources to implement the SOP. From this story, we can tell that Pak Dilan, the brand and product owner of Alif Kurma n Friends is a franchisor. On the other hand, Mrs. Milea acts as a franchisee.

As a franchisee, Ms. Milea will routinely continue to buy products to fill her shop, which has a signboard with the brand Alif Kurma n Friends. As a Franchisor, Mr. Dilan gets regular purchases from his franchisees; however, there are Quality Control responsibilities that need to be taken seriously, because poor service in one shop managed by a particular franchisee can disrupt the level of sales and consumer confidence in stores managed by other franchisees. How about friends of UKM, hopefully now the details are clear, yes, what is a franchise system, franchisor, and franchisee?

How to Start a Franchise Business?

If you want to use a franchise strategy in your business, you don’t need to be afraid. Because this franchise scheme has been regulated by the Government in such a way. The latest regulations related to franchising have been issued by the Ministry of Trade or the Ministry of Trade in MOT no. 71 years 2019.

In this regulation, the government provides facilities for business actors in conducting franchises, one of which is the elimination of franchise outlet restrictions. In the previous regulation, food outlet owners were limited to a maximum of 250 outlets, while modern shop ownership was limited to a maximum of 150 outlets. In addition, the level of components (materials used) in the country, which was previously required to be 80 percent, now only becomes mandatory without a minimum limit. If you have question, ask law firm jakarta you trusted.

This is a form of government support for business actors in Indonesia, you know. So friends of UKM, let’s take advantage of this opportunity as best as possible. So, here are the things you must do to start a franchise business.

Develop a business concept

If you already have a business and want to become a franchisor, then there are a number of things you need to do. The first step, friends of UKM need to prepare their business concept carefully. The business concept in this case is whether what you offer will only sell trademarks or also include others, such as raw materials, business premises or booths, and so on.

Which is better, selling only trademarks or selling the “complete package”? The answer depends on the readiness of UKM friends. If indeed raw materials, business premises, and other necessities have been mastered by UKM friends, then this can be one of the values ‚Äč‚Äčthat UKM friends can offer. However, if you feel that you are not ready to handle it all, then selling trademarks alone can be an option.

Register a trademark

In this connection, registering a trademark is very important. Yes, friends of UKM, one of the intellectual property assets in your UKM’s business that needs to be protected is a brand, and the way to protect it is to register it with the Ministry of Law and Human Rights. After being registered, SME’s friends will get a Trademark Certificate issued by the Ministry of Law and Human Rights. You could seek help from law firm indonesia.

Taking care of the legality of legal entities

After you have registered your trademark, you should immediately take care of the legality of the legal entity for your business. Yes, friends of UKM, if your business wants to be raised through a franchise scheme, then the business must be a legal entity. Friends of UKM take it easy, do not have to be a PT or Limited Liability Company. Having a CV (limited partnership) can also be an option for SME friends to choose. Steps that UKM friends need to go through if you want to take care of a legal entity CV, including making deeds and establishing a CV, making a Company Domicile Certificate, making a Taxpayer Identification Number or NPWP, making a Trading Business License or SIUP, and making a Company Registration Certificate. or TDP.

Calculate business feasibility

The next stage in this franchise is to calculate the business feasibility test that UKM friends have. In common language, SME friends must calculate how long it will take for the franchisee’s capital to return. Of course, the sooner this capital can be returned, the more attractive will be the franchise business of SMEs friends in the eyes of prospective franchisees or business partners. Bakso Malang Kota “Cak Eko” is an interesting example. The meatball outlet business line pioneered by Mas Henky Eko as a franchisor and has been established since 2006 offers a franchise business that can be BEP or a return on investment for 5 months with a franchise fee of IDR 35,000,000 which is valid for 5 years.

Baca juga : Things you should know before registering a company in Indonesia

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