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Breaking The Mold

Leaving the corporate clone behind, a new breed of franchisee proves buying a franchise doesn't have to mean selling your soul.

David Gard straightens the bow tie on his black tux and checks his shining reflection in his dress shoes. He double-checks his inventory of CDs and equipment and heads out to today's gig. The reception hall where he sets up is bedecked with crepe-paper bells, pastel streamers and a "Just Married" banner.

Gard ruminates on the perfect song to get the guests dancing. No matter how good the food is or how many tiers the wedding cake has, it's his responsibility to make this wedding reception a party. As a DJ, Gard wears many hats. Emcee. Crowd-reader. Request-taker. Line-dance teacher. Franchisee.

Franchisee? No--that couldn't be. Franchisees are middle-aged management types in dress shirts and ties behind the counter at McDonald's. They fill out endless reams of paperwork and display sale signs only--and we mean only--when the franchisor says so. Right? Wrong.

There's a common sentiment in the franchise community: If a business can succeed as a single unit, it can probably be franchised. Which means franchising has moved far beyond fast food into such diverse areas as deejaying and dog washing. The International Franchise Association (IFA) identifies 70 categories in franchising and estimates franchising will bring $1 trillion into the U.S. economy next year.

With such diversity, franchising isn't just follow-the-leader anymore. Pick an interest, decide what level of participation you want (and need) from your franchise system, and there's probably a franchise that can offer you the satisfaction of owning your own business, plus the benefits of experience, pooled resources and a well-known name.

Franchising has two separate definitions: one legal, one business. According to Washington, DC, franchise attorney Andrew A. Caffey, a franchise is recognized legally if three elements are present in a business transaction: the licensing of a trademark, substantial assistance with the business's operations, and the payment of a franchise fee.

"The business definition is, in many ways, a more important and accurate description," says Caffey. "The business definition is a continuing, almost symbiotic, relationship between a franchisor, who owns intellectual property and know-how, and a franchisee, who invests money in developing a business using that intellectual property and experience. The franchisee can use a proven program and thereby reduce risk when opening a business. In exchange, the franchisee pays the franchisor a [franchise fee and] royalty."

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This article was originally published in the April 1999 print edition of Entrepreneur with the headline: Breaking The Mold.

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