What is Franchising?

Franchising is a business model where a franchisor grants a franchisee the right to operate a business under its established brand, system, and support structure in exchange for fees or royalties. In Switzerland, franchising is a popular approach for expanding businesses and enabling entrepreneurs to operate proven business concepts.

Key Features of Franchising in Switzerland

  1. Legal Framework
    Switzerland does not have specific laws governing franchising. Instead, franchising agreements are regulated by the Swiss Code of Obligations (CO), particularly under contract law. Agreements must clearly outline the rights and responsibilities of both parties, ensuring transparency and compliance with Swiss legal standards.
  2. Franchise Agreement
    This document is central to the franchising relationship. It typically covers:

    • Use of trademarks and branding.
    • Training and operational support provided by the franchisor.
    • Fees, including initial payments and ongoing royalties.
    • Performance expectations and territory exclusivity.
  3. Market Potential
    Switzerland’s stable economy, strong purchasing power, and diverse consumer base make it an attractive market for franchising. Franchises in sectors such as retail, food and beverage, and health services have seen consistent growth.

Benefits of Franchising

  • For Franchisors: Franchising allows businesses to expand their brand without directly managing new locations, leveraging the franchisee’s investment and local knowledge.
  • For Franchisees: Entrepreneurs benefit from operating under an established brand with proven systems, reducing the risks associated with starting a new business.

Franchising offers a mutually beneficial partnership model, combining the strength of an established brand with local entrepreneurial drive. In Switzerland, it remains a dynamic and growing business strategy, fostering innovation and economic growth.