Network Franchise

Network Franchising [NF] is a sales, marketing, and distribution strategy used by organizations for business expansion. Organizational revenue is realized through a non-salaried workforce whose compensation is based exclusively by the sale of goods and services. Network franchise owners operate as independent contractors or 1099 freelancers and retail goods and services. Network franchise owners are not employees a company (principle) but work as independents agents and may be subject to the law of agency.

Business model

Network franchising takes elements of various business models as well as differentiates itself from the following:

Franchising

NF takes advantage of the following franchise benefits: branding, operational efficiencies and customer relationships at the NF level. NF discards large, upfront franchise fees and recurring royalty payments for a small annual administration fee.

Direct Selling

Goods and services are sold to end customers through Direct selling, which relies on person-to-person marketing. NF owners have no territory restrictions and operate as independent agents.

Network Marketing

Franchise owners can grow their income beyond their own ability to sell goods and services through profit sharing. Network Franchising distinguishes itself from Network Marketing in two ways. First, there are no high up-front costs (sometimes call buy-in or starter packages). Second, owners are not directly compensated for recruiting other people into the organization. In Network Marketing, the majority of customers are actual participants in the business. Whereas, the majority of Network Franchising customers are only consumers of the products.

Employee benefits

Corporate benefits are available to a segment of (non-employee) NF owners.

References

This article "Network Franchise" is from Wikipedia. The list of its authors can be seen in its historical and/or the page Edithistory:Network Franchise. Articles copied from Draft Namespace on Wikipedia could be seen on the Draft Namespace of Wikipedia and not main one.

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