Alexander metelev
Online vs. offline: similarities and differences between an Internet franchise and offline business
Which one is better - an online franchise or a standard real life business option?
Doing business alone is not easy. Beginning entrepreneurs in particular can be pursued by serious difficulties in starting building their own business. Such are the conditions of the modern business sphere, beginners are always difficult to develop their business from scratch. That is why you can see so many examples of failed financial projects.



However, you can increase the chances of success of your company. To do this, you need to pay attention to franchises, which can become a solid foundation for a stable and profitable business. As practice shows, there are more and more those who want to acquire franchise rights and start their own business on its basis.




Franchise: the definition of the concept and the scope of its application

In the business sphere franchises appeared a long time ago. They were actively disseminated in the middle of the last century. The definition of the franchise states that such projects are business organizations in which large companies or corporations offer smaller entrepreneurs or small firms to obtain rights to produce goods or services under the brand name of the parent enterprise for a fee. In this case,the owner of rights is called a ''franchisor'', and his partner is a ''franchisee'' or ''dealer'', according to the business language. At the moment, franchises are divided into two main types: those that work in the online environment, and those that operate in offline mode.


How are online franchises organized?

Online franchises operate under a standard franchise business scheme. Any large enterprise, having reached a certain point in its development, can look for partners who would act as its dealers. Online franchisees become profitable - usually for creating a dealer project you do not need a lot of money (on average from $ 1,000 to $ 5,000) - and in return you receive a completely ready-made business that can be launched right away.

As an example of online franchises, you can take a look at the services of Instalex and ECIR. They entered the franchise market a couple of years after their appearance, after finding their audience and getting the status of reliable promotion systems in social networks. Now Instalex and ECIR offer to acquire the right to use their franchise anyone willing. By signing an agreement with any of these services, the client receives her own business to promote accounts in the most popular social networks of our time.



The operating principle of offline franchises

The essence of offline franchises is similar to their online counterparts. There are no special differences here - the franchisor enters into an agreement with the franchisee and grants them the right to use their own brand in the production of goods or services. The difference from online franchises is in the costs of the dealer: to open an enterprise for a franchise in offline, you spend on average from 50,000 to 100,000 $.

An example of an offline franchise is known to almost everyone - it's the old good McDonald's. It was from their company that the franchising scheme of doing business spread to the whole world. The franchise of this fast food continues to expand to this day, covering more cities and countries.


Similarities and differences

As you can see, the essence of franchises in the online field and offline environment is the same. Both business models represent cooperation between two partners, in which the dealer buys the right to use the brand from the franchisor. The only difference is the cost of investment required from the franchisee. In online franchises, you have to spend tens of times less money to create and develop the project than in their offline counterparts. This is explained by the difference in costs: when creating an online business, you do not have to pay for finding a place for your company, renting offices and their services.


What is better?

Obviously, online franchises are more profitable for franchisees. Their cost is less, projects on their basis are created faster, and their maintenance and support is much easier. Note that online franchising is recommended even for novice businessmen who do not have a solid starting capital. Therefore, now you can safely proceed with the selection of a suitable online project for the purchase of rights to its franchise.
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