A Master Franchise is a grant obtained by a franchisee to
operate franchises within a specific region by ‘buying into’ the
right to start two or more franchises in such region. The
concept of Master Franchise enables the parent company
(franchisor) to grow faster and at the same time Master
Franchisee enjoys revenue that is much higher compared to
a normal franchisee.
Master Franchise holding is considered more esteemed as
compared to single unit franchises as scale of operation is much
higher and hence a master franchisee provides entrepreneurial
opportunities and generates employment. Master Franchisee enjoys
a position of a franchisor with the sub- franchisees. Hence it
involves higher amount of satisfaction of being an entrepreneur.
One of the major benefits of the master franchise is the return on
investment as many a time the investment is just a little over the
normal franchises. Some of the franchisors do not even need the
master franchises to operate a centre themselves as long as they
compliment all the marketing and support function to the franchises.
And on the other hand master franchises get a share from franchise
fees and royalty fees even up to 50%.
For Example: If an IIHT Technologies Franchise fees is about
$25000 and royalty fees is fixed at $8000 a year and the Master
Franchise has a 50% share then, they enjoy $12500 for sale of
each franchise and $4000 as royalty fees from each franchises
Even though the idea of Master Franchise
sounds great there are many other aspects to
consider such as qualities of the franchisee.
The risks involved is higher and responsibilities
as well. Master Franchisee functions as a
catalyst and will need to simultaneously work
with franchisor and the franchisee.
Master Franchises also have to continuously
work with the franchisor in developing
marketing strategy and the like. The qualities
that are essential to purchase a master
franchise would involve.
• Professional experience or expertise in
the product line or service line
• Strong managerial skills
• Strong networking and communication
• Ability to work effectively within a
controlled atmosphere of franchise
• Financially equipped
• Marketing skills
These qualities are also sought after by
the franchisor in a potential franchisee of a
Indian Institute of Hardware and Technology (IIHT) is a leading training institute in IT (Information
Technology) IMS (Information Management Services) that has made its successful presence in
over 20 countries through its franchises offering high quality courses in latest technologies.
IIHT as well seeks for the same attributes in a potential franchisee of a Master Franchise. Master
Franchisees enjoy continued support from IIHT Technologies and share the revenue generated
from the sub-franchises. IIHT offers in-depth training, support in merchandising and set up
ensuring that a master franchise could function almost independently in the designated area.
The Franchisee receives:
• Licence from IIHT to operate as a Master Franchise
• Shares IP with actual ownership held by the franchisor
• Provides access to course ware and other intellectual property
• Provide training to the franchisee, management, marketing team and the trainers
• Support in creating marketing strategy
• Support with merchandise
• Aid to affiliations and accreditations
The franchisee of a master franchise has to purchase the rights and will bear other fees and
charges. Franchisee will be eligible for share in franchise fees, royalty fees and other charges
received from the sub franchises as predefined in the agreement.
Thus a Master Franchise itself is an exquisite entrepreneurial opportunity in a lower risk
environment, with continued support from franchisor and higher benefits in comparison to
Success is not too far away for a person who possesses essential qualities and the right attitude to
operate a master franchise.
#15,Sri Lakshmi Complex, 4th Floor, St. Marks Road, Bangalore - 560 001. India
Tel: 91 80 6160 4545 e-mail: firstname.lastname@example.org