Franchise or distributorship: which expansion model fits?
Two ways to grow through partners, with very different levels of control and investment.
Franchising
A franchisee runs a copy of your business under your brand, following your systems, and pays fees or royalties. You get fast expansion with partner capital, but must invest in training, operations manuals and brand control.
Distributorship
A distributor buys your products and resells them in a territory. You keep it simple, with no brand outlets to manage, but you have less control over how products are presented to customers.
How to choose
If the customer experience is the product (restaurants, salons, schools), franchising usually fits. If the product itself is the product (FMCG, electronics, agri inputs), distribution usually fits.
Before you start
Document your unit economics, define territories clearly and write down exactly what support you will provide. Clear agreements prevent most partner disputes.
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