Now that you have researched into some franchise opportunities you must have a general idea about the types of franchises. There are a few different types of franchises available and although they may seem like a good deal you still must be aware of the pros and cons of each type. Being quite knowledgeable about the types of franchise opportunities will help you make a good choice of which franchise to go into.

Although there aren’t any hard and fast rules, you can generally categorize any franchise in one of two ways. These two main groups make up most all of the franchise opportunities available to you. The first is known as product and trade name franchising. The second is called business format franchising.

Big blue chip companies and industry names in the gas (petroleum), automobile, soft drinks and beverage sectors can usually be found under the product and trade name franchising umbrella. While the big company supplies the merchandise, logo and trademarks, and usually takes responsibility for some or most of the advertising, the franchisee doesn’t pay royalties on sales. The franchisee sells the services or products provided by the manufacturer. In general, the franchiser will assist in the set-up and advise on the best locations for the business, and continue supplying goods and things such as vending machines (with all the servicing needed to keep them operating successfully) and whatever else is required to sell products.

The second method is business format franchising. An essential part of the business format franchising is the use of trademarks and logos. The franchiser will help with the site selection and the franchise company will determine the design and layout of the business.

When some studies suggest that the colors of the walls and seating in fast food restaurants seem to influence how quickly the customers eat, it’s not surprising that franchisers are eager to engage with the franchisee at even this most fundamental level. The franchiser will also be involved in training and advertising, even having a say in the preferred philosophy and mindset of its employees.

Some common examples are fast food chains, real estate agencies, convenience stores as well as recruitment agencies.

The franchisee will pay a fee up-front at start-up and continuing royalties in return for continued assistance of the franchiser.

Acquiring a franchise based solely on the brand name will not guarantee your business instant success. You really need to consider which type of franchise suits your personality and interests. Be aware and choose wisely.