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Franchising In China
Offering Franchisors
International Opportunities
for Expansion
China has developed
an important market serving the worlds'
business growth and Franchise Expansion.
Business today has the ability to
penetrate the Chinese Market in it's
early stages. Later on, these windows of
opportunity may have passed.
The Chinese
marketplace has a proven consumer base
of over 1 Billion persons. The economy
in China is growing at double digit
figures and its' people have a desire
for more luxuries and a better way of
life. Western ideals and styles,
including dress and food consumption
have skyrocketed into one of the most
expansive economies in the world today.
The United States
is the leading franchising market in the
world, so far. But China is fast on its'
heels and might soon overtake the USA.
It is a very astute and exciting market
for international franchise companies to
penetrate, since the Chinese have always
tried to adapt to the Western way of
life.
The Chinese
Government has allowed foreign franchise
companies to penetrate the China market
with new, more relaxed rules and much
easier entry. Some of the American
companies presently franchising in China
are: KFC, McDonalds, Pizza Hut,
Starbucks, Days Inn, Sign-A-Rama, and
many more. To facilitate this new
attitude in China, the government has
joined the WTO, (World Trade
Organization) and adopted their rules of
conduct.
The method of
entering the Chinese marketplace is best
used by securing area developers in the
100 + urban enters that have over 100
million consumers. These persons have
demonstrated an ongoing desire for more
western goods and services.
Franchising
in China with a Master Franchise system
geared to the extremely large Chinese
market, normally multiple master
franchises are best advised. The most
important thing to remember when
contemplating the Chinese Franchise
Market is that you are entering the
second largest Franchise market in the
entire world and to be prepared to
expand your Franchise system quickly to
take advantage of this burgeoning
consumer marketplace.
Platinum Franchising
Program
Provinces In China
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Anhui |
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Aomen |
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Beijing |
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Fujian |
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Gansu |
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Guangdong |
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Guangxi |
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Guizhou |
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Hainan |
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Hebei |
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Heilongjiang |
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Henan |
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Hubei |
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Hunan |
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Jiangsu |
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Jiangxi |
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Jilin |
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Liaoning |
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Nei Mongol |
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Ningxia |
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Qinghai |
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Shaanxi |
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Shandong |
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Shanghai |
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Shanxi |
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Sichuan |
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Taiwan |
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Tianjin |
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Xianggang |
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Xinjiang |
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Xizang |
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Yunnan |
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Zhejiang |
China Franchise Rules Summary
- Basic information on the franchisor and the franchise activities, including information regarding the bankruptcy or application for bankruptcy of the franchisor over the past five years.
- Basic information on the franchisor’s possession of operational resources, including information regarding any litigation or arbitration that has occurred in relation to such resources.
- Basic information regarding franchise fees.
- Prices and conditions of products, services, and equipment to be supplied to the franchisee.
- Continuous services to be provided to the franchisee.
- Specific methods and contents of guidance and supervision on the franchisee’s operation, including whether and how the franchisor will bear joint and several liability for customer complaints. This provision helps to clarify the Regulation’s requirement that franchise contracts include information on "liability for damages/compensation arising out of the franchise."
- Investment estimates of franchise stores/outlets.
- Relevant information on franchisee(s) within China.
- Abstract of financial accounting report and abstract of auditing report of the past years. This provision reiterates a clause from the Regulation.
- The franchisor’s material litigation and arbitration in the past five years related to the franchise activities. The Regulation had required a franchisor to disclose "all issues relating to litigation and arbitration during the past five years."
- Record(s) of material illegal operation of the franchisor or its legal representative.
- Franchise contract text.
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Experts in Franchising
™
Platinum Franchising
Program
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