Franchise Brands – from pizzas to plumbing and pets

Franchise Brands, a new venture from the team behind the growth of Domino’s Pizza in the UK, is on track for success, says Bruce Packard.

Metro Rod van © Alamy
Metro Rod kept on motoring during lockdown
(Image credit: Metro Rod van © Alamy)

The remarkable thing about the franchise industry is that in theory it shouldn’t work, but in practice it does. For instance, there’s very little that can’t be copied in the restaurant sector: there’s hardly any legal protection against a competitor imitating designs, menus and themes. Yet Subway, McDonald’s, 7-Eleven, Dunkin’ Donuts and Domino’s Pizza are obviously successful franchise businesses.

The way franchising works is that the franchisor licenses the brand and intellectual property to the franchisee, who trades as a small business. The franchisee operates using the back-office systems that the franchisor has set up and enjoys support in the form of training and mentoring.

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Bruce Packard
Contributor

Bruce is a self-invested, low-frequency, buy-and-hold investor focused on quality. A former equity analyst, specialising in UK banks, Bruce now writes for MoneyWeek and Sharepad. He also does his own investing, and enjoy beach volleyball in my spare time. Bruce co-hosts the Investors' Roundtable Podcast with Roland Head, Mark Simpson and Maynard Paton.