What is a Franchise?

Etymologically, a “franchise” is an agreement between two parties, where one Party (the Franchisor) allows the other party (the franchisee) to market product or services using the trademark and operating methods of the Franchisor.

 

There are two types of franchise methods:
a) Business Format Franchising; and
b) Product and Trade Name Franchising.

 

Business Format Franchising

In this method the franchisor grants the franchisee the rights to use their logos and trademarks, as a turnkey system for doing business.

 

MDA CAPITAL INVEST, a.s., called the Franchisor Agent, shall herein assist under contract the franchisee in the development of the business locally, consisting of construction site selection, store layout and design, recruiting and training staff, marketing strategy of the business, preferred supplies contacts and more.

 

The franchisee in return has to pay an upfront franchise fee as well as ongoing royalties to the Franchisor. The Franchisor uses this money to help further develop the system through marketing, product and market research, and ongoing support.

 

We have a big range of Business Franchising opportunities:
 •  food franchises;
 •  automotive franchises;
 •  estate agency franchises;
 •  retail franchises;
 •  recruitment franchises;
 •  coffee franchises;
 •  pet franchises;
 •  fitness franchises;

 

Many of these are ideal franchises for women, home-based franchises, part-time franchises, and mobile franchises, and not all required a high level of investment, some are considered low-cost franchises.

 

Product and Trade Name Franchising

Product and Trade Name Franchising is the other type of franchising, which does not involve royalty fees. The Franchisor provides the product to the Franchisee buying the Product and Trade Name Franchising.

The franchisee is required to purchase the product or range of products exclusively from the franchisor. The franchisor also provides national marketing and advertising campaigns, logos and trademarks.

This type of franchising is mainly associated with industries such as petroleum, soft-drink distribution and automotive.

 

Product and Trade Name Franchising has three distinctive characteristics:
1. The franchisee sells goods, which are supplied by the Franchisor;
2. The Franchisor, through MDACI/MDAICReal, the Franchisee’s representative and business developer, shall help in the development of the Franchisee’s business from design to construction and operation;
3. Within the first three (3) months of the operation of the business, the Franchisee must pay the Franchisor.

 

NOTE: The Franchisee shall be responsible shall be responsible for the cost of the development of the business locally, consisting of data gathering, techno-economic studies, detailed technical designs of the facilities and layout, construction site selection, recruiting and training staff, marketing strategy of the business, preferred supplies contacts and more, which shall be carried, for the purpose of business branding by MDA CAPITAL INVEST, a.s/MDAICReal, s.r.o. (MDACI/MDAICReal) and Consortium (Technical and Financial Consortium).

 

MDACI’s Financial Consortium is ready willing and able to provide a financial support to qualified Companies up to 85% of the Total Invest Capital/Total Project Cost, including the three (2) months Operations Management Cost and all other fee, which shall be paid to the Franchisor before and during the first three (3) months of operation of the business.
 

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