The FOPO Model and FOCO Model are two prevalent franchise structures.
FOPO Model:- Franchise Owned: The franchise is owned by an individual or a partner.
Partner Operated: Operations are handled by the franchise partner.
Independence: Franchisee has a degree of independence in running the business.
FOCO Model:- Franchise Owned: The franchise is owned by the company or brand.
Company Operated: Operations are managed by the company’s team.
Consistency: Ensures standardized operations across all franchise locations.
Difference Between FOPO & FOCO Model
Franchise Owned Partner Operated (FOPO) and Franchise Owned Company Operated (FOCO) are two business models within the franchising industry.
Let’s delve into their definitions and differences:
Franchise Owned Partner Operated (FOPO)
Presented by The Rolling Plate, the FOPO business model, which is being introduced in India, will be a game changer in the Indian food and beverage industry. Various models and strategies for fostering growth and success have emerged in the fast-paced world of business. The Franchise Owned Partner Operated (FOPO) business model has gained traction.
In the Franchise Owned Partner Operated (FOPO) model, a franchisor grants a franchisee the right to operate a franchise unit while partnering with a third-party operator to manage the day-to-day operations. This third-party operator is known as the partner operator.
The franchisee remains the owner of the business and holds a significant stake in its success, while the partner operator assumes the responsibility of running the operations.
Key Points about FOPO:
The franchisee retains ownership of the business.
A third-party operator, known as the partner operator, manages the operations.
The franchisee and partner operator work collaboratively to achieve business goals.
The franchisee may have limited involvement in the daily operations but maintains control over major decisions.
Franchise Owned Company Operated (FOCO)
ranchise Owned Company Operated (FOCO)” is a business model where an individual or entity owns the franchise rights to a brand or company, but the day-to-day operations are managed and operated by the company itself. In this arrangement, the franchise owner typically invests in the business and benefits from the brand’s recognition and support, while the company retains control over the management and execution of operations. It’s a collaborative setup where both parties contribute to the success of the venture, with the franchise owner enjoying the advantages of a proven business model and established brand.
Key Points about FOCO:
- The franchisor directly owns and operates the franchise unit.
- The franchisor assumes full control over the operations.
- The franchisee may not have an active role in the day-to-day operations.
- The franchisor retains the majority of the decision-making power.
Advantages of Franchise Owned Partner Operated Business Model
The FOPO model offers several advantages for both franchisees and franchisors.
Shared Responsibility: In the FOPO Model and FOCO Model, the franchisee and partner operator share the responsibility of operating the business. This allows the franchisee to focus on strategic aspects, such as business expansion and marketing, while the partner operator handles the daily operations. It creates a synergy between business expertise and operational efficiency.
Leveraging Expertise: Partner operators in the FOPO Model and FOCO Model have often experienced professionals in the industry. They bring specialized skills, knowledge, and operational insights that can significantly benefit the franchise unit. Franchisees can tap into this expertise without having to acquire extensive operational experience themselves.
Reduced Workload: By partnering with a professional operator, franchisees can alleviate the burden of managing day-to-day operations. This gives them more time to concentrate on higher-level tasks, such as building customer relationships, exploring growth opportunities, and refining business strategies.
Cost Sharing: In FOPO Model and FOCO Model arrangements, franchisees can share certain operational costs with the partner operator, such as employee wages, training expenses, and equipment maintenance. This shared financial responsibility can help ease the financial burden on franchisees, especially during the initial stages of business establishment.
Flexibility and Scalability: The FOPO Model and FOCO Model offers flexibility and scalability for both franchisees and franchisors. Franchisees can focus on expanding their franchise portfolio while relying on the partner operator to handle day-to-day operations. This flexibility allows franchisees to enter new markets or diversify their business interests.
Advantages Of FOPO Model and FOCO Model
The FOPO Model and FOCO Model also provides several benefits for franchisors and franchisees.
Let’s explore some of them:
Consistent Brand Standards: With complete control over operations, franchisors can ensure that their brand standards are consistently upheld across all franchise units. This includes everything from customer service to product quality, resulting in a cohesive brand experience for consumers.
Direct Influence on Operations: Franchisors in the FOPO model and FOCO Model have direct influence and control over every aspect of the franchise unit’s operations. They can implement standardized processes, train employees according to their specific protocols, and make adjustments swiftly to adapt to market demands.
Stronger Brand Loyalty: When franchisors operate franchise units themselves, they have the opportunity to build strong relationships with customers. Direct interactions enable them to understand customer preferences, gather feedback, and address concerns promptly. This personalized touch can foster loyalty and strengthen the brand’s reputation.
Enhanced Quality Control: In the FOPO model and FOCO Model, franchisors can maintain strict quality control measures across all franchise units. They can ensure consistent product quality, adherence to operational standards, and compliance with regulations. This level of control reduces the risk of inconsistency that may arise in a FOPO model and FOCO Model.
Efficient Communication: With direct ownership, franchisors can communicate operational changes, marketing strategies, and new initiatives effectively to franchise units. This streamlines communication channels reduces information gaps, and facilitates faster implementation of strategic decisions.
About The Rolling Plates’ FOPO Super franchise business model:
With an initial investment of 12 lacs and a payback period of 6 months, this is India’s first and cheapest FOPO business model from The Rolling Plate’s pan-India business growth strategy.
One local cloud kitchen can operate multiple brands under The Rolling brand parent company in this FOPO model and FOCO Model. It means you won’t need any additional rent, salaries, or anything else. This business model allows you to earn more money through franchise fees and food sales.
You might wonder, “Can a partner become a franchisor in the future”?
Yes, in some cases, a successful partner may be able to become a franchisor in the future. If the partner demonstrates exceptional performance, scalability, and a desire to expand their franchise unit network, the franchisor may consider allowing them to become a franchisor themselves.
Conclusion:
When considering a franchise opportunity, understanding the difference between FOPO Model and FOCO Model business models is crucial. FOPO allows franchisees to retain ownership while partnering with a third-party operator, sharing responsibilities, and leveraging expertise.
On the other hand, FOCO grants franchisors complete control over operations, ensuring consistent brand standards and stronger brand loyalty. Both models have their advantages and considerations, so it’s essential to evaluate your goals, resources, and preferences before making a decision.
Choose the model that aligns with your entrepreneurial vision and positions you for long-term success.
