Business Format Franchising

Ray Kroc 1952

Ray Kroc (1902-1984) was not the inventor of Business Format Franchising, but he was the first person to fully realise its potential. Franchising had been around for a long time, but based on the Speedee Service System, Kroc offered franchisees a complete turnkey solution, and an entire system of doing business.

Ray Kroc

Ray Kroc

The idea was to codify and capture the entire business process, and the new business development process so that these could be franchised alongside the trade name, giving investors a much higher probability of success. Project managing the opening of a new McDonalds outlet, and subsequently managing its service offering became as straighforward as it is possible for a business to be, resulting in a new franchise failure rate of less than 5%.