Difference
between Franchise and branch
Branch is sub office of
the entity and operated by itself, where franchise is operated or run by other
party known as franchisee. Franchisee uses the business methods & services
of the Franchiser against an agreement.
Difference between
Franchise and branch can be explained in term of operation, investment in
operations, operational employee, profit sharing and quality of the product and
services.
1. Business Operations
In case of branch entity
itself responsible for business operations and operational decision making,
where in case of franchise another party is responsible to carry out the
business operations.
2. Investment in Operations
in case of branch,
investment in operations are made by the entity , while in case of franchise
the investment for operation is made by the another party (Franchisee).
3. Operational Employees
In case of branch employees
responsible to carry out operations are employed by the entity, while in franchise,
those employees are employed by the franchisee.
4. Profit Sharing
In branch there is no
profit sharing concept with another party, entity enjoy the sole profit from
the operations, in case of franchise some profit is shared with franchisee.
Profit sharing arrangement varies franchise to franchise.
5.
Quality assurance
In case of branch quality
is directly maintained by the entity, while in case of franchise quality is
ensured by effective monitoring.
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