The History of Franchising - The Creation of the Franchise Business

 


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The franchise business has been around a long time, in fact they go back as far back as the 1850’s. The notion of selling off a business or a part of a business in order to expand into new areas usually came from the lack of investment funds from the business owner. Through their creativity they were able to keep the business alive by selling franchise opportunities to would-be entrepreneurs.

While the business of franchising has grown over the years it all had to start somewhere. The concept of franchise businesses began with none other than the sewing machine manufacturer, Singer.

The Singer Franchise Business Opportunity

In the 1850’s the Singer Company produced sewing machines but didn’t have enough capital to actually pay their salesmen salaries. Instead, they created a network of dealers. These first franchise owners paid Singer a fee to work in a particular territory and earned money for each sale of a sewing machine they bought from the company and resold.

Their significance in the start of the franchise and the opportunities it created came from the creation of the contract that is still used today between the original business owner and the new entrepreneur. Many feel the contract was what really sparked the creation of franchises in the future as it allowed business owners to keep some control over how the franchisees were run.

The Coca-Cola Company Franchise Business Opportunity

When Coca-Cola was originally created, it was only sold as a fountain drink. In 1899 two men obtained a short 600-word contract and the permission to bottle the soda.

Thomas and Whitehead soon realized that even though they had a great idea, they couldn’t afford to actually create a bottling company. As an alternative, they created a franchise company selling the right to bottle the product to individual bottling plants.

The KFC Franchise Business Opportunities

One of the most famous start-ups in the franchise industry was Kentucky Fried Chicken. The franchise opportunity began when Harlin Saunders, or the ‘Colonel’ was about to go under. His business started to fail when a highway was created seven miles away from his restaurant. With his business going under, Sanders had to find new ways to get his famous chicken to people.

When Sanders finally lost his business, he went practically door-to-door to sell his chicken recipe. His popularity improved with time and within a few years he had restaurant owners coming to him. He set up franchises and today there are over 10,000 KFC restaurants all over the world.

Companies Leading The Way For Franchise Business Opportunities

The establishment of KFC and others like it led the way for businesses to expand all over the world. It also gave the opportunity for new entrepreneurs to find the path to success. Many of KFC’s first franchise owners became millionaires. People who joined in with similar companies like McDonald’s also found success.

Thanks to these companies, we now have the opportunity to share in the success of other businesses and business owners have the opportunity to expand their dream. By reaching out to others, they can build a franchise empire out of a business opportunity.

Paul Stuart is a writer for whichfranchise.org. whichfranchise.org provides potential franchisees with free and impartial information, advice and opportunities. For more information visit http://www.whichfranchise.org

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