fact sheet Guidelines for starting a franchise business Franchising has been a Franchising means that someone who has Rules and regulations well-established concept in started his own company and has managed There are no speciﬁc regulations for franchi- to achieve a successful business will let one sing, but certain legislation does exist that Sweden since McDonalds ﬁrst or more company owners “hire” or use the impacts the establishment and running of arrived to spread throughout company name and the business concept. It a franchise operation, and one should take the country. is a long-term cooperation between two busi- these and other laws into consideration: ness partners. The cooperation is regulated • The contract act by an agreement signed by the two parties. • Intellectual property legislation Franchising can be described as a sort of sale • The agency act permission and it may be practiced almost • The competition act within any sector where products and/or services are being marketed. Therefore The franchise agreement franchising is not a business entity but rather There are no standard agreements that a way of doing business. regulate a franchise business, but every agreement is set up individually in accordance Swedish franchising history with the particular needs of the partnership At the beginning of 2004, the estimated in question. The franchise agreement is set number of franchising chains in Sweden was up between two independent parties, who approximately 300, the majority of which is will continue to be independent legally and of Swedish origin. Comprising some 15,000 economically. The agreement shall be in franchise units, employing 100,000 persons, writing and clearly deﬁne the rights and the total turnover of Swedish franchising is obligations of both parties as well as the approximately 10 billion USD. About half of division of labor between them. the franchisers is active in retailing, however In the agreement the franchise holder consulting and restaurants are also common will grant the franchisee the right to use a ﬁelds of business. company name, a trademark and a sys- tem. The experience and know-how of the Top ten franchising systems in Sweden franchise holder is often also offered to the Company Number of franchise units franchisee’s disposal. Posten Sverige AB 2800 The franchisee will commit himself to the Svenska Turistföreningen 309 policy of the operation in order to strengthen Svenska McDonald’s 235 Sibylla/Nordic fastfood 229 the picture of a group of stores with a standar- JCA Aktiebolag 217 dized structure, quality and service. AB Svenska Pressbyrån 160 The economic details are settled in the Elkedjan 156 agreement. Normally the franchisee pays Färgtema 132 an “entry fee” and after that a royalty that is Gröna Konsum 122 Tema Sportia AB 110 usually based on a percentage of the turnover. Electrolux Home Svenska AB 106 Däckteam 100 A large majority of franchising systems has started since 1990, and the number is expec- ted to increase in coming years. Published in October 2005 Invest in Sweden Agency P.O. Box 90 SE-101 21 Stockholm, Sweden Phone: +46 8 402 78 00 Fax: +46 8 402 78 78 E-mail: firstname.lastname@example.org www.isa.se fact sheet Registration of a company The Swedish Franchise Association For more information: In order to carry out the franchising business Although not required by law, franchi- Swedish Franchise Association the franchisee has to register a company. sers are advised by the Swedish Franchise (Svenska Franchiseföreningen) The legal company form, such as limited Association to describe their concepts Sofierogatan 3A liability company or trading company is often and inform franchisees in an ofﬁcial SE-412 54 Göteborg stipulated in the agreement. The procedures manner through a form provided by the Phone: +46 31 40 55 10 Fax: +46 31 81 10 72 for starting a company are the same for the association. This gives both parties a clear email@example.com franchisee as for others. starting point for future cooperation. Among www.franchiseforeningen.se other elements, the document should contain information about the franchi- sing system, the franchisee’s obligations, Effectum Franchise Consulting Södermälarstrand 29, 6tr marketing responsibilities and the fees the SE-118 25 Stockholm franchisee is to pay under the agreement. Phone: +46 8 652 12 00 Fax: +46 156 17572 firstname.lastname@example.org www.effectumsweden.se Established in 1983, Effectum is experienced in helping companies and organizations to develop their franchising business. Franchisekollegiet Danderydsgatan 11 SE-114 26 Stockholm Phone: +46 8 646 00 00 Fax: +46 8 34 93 25 email@example.com With ten consultants Franchisekollegiet specializes in starting franchises, analyzing existing franchises and international franchising. FranchiseNet i Skandinavien AB Sofierogatan 3A SE-412 51 Göteborg Phone: +46 31 40 72 00 Fax: +46 31 81 10 72 firstname.lastname@example.org www.franchisenet.net FranchiseNet is a link between franchisers and franchisees. The website contains information about franchise-related issues. Advizor Petter Dahlberg Kungsgatan 66, 5 tr SE-111 22 Stockholm Phone: +46 8 410 664 20 email@example.com www.advizor.se Advizor has six highly experienced consultants assisting business chains in the retail and service sectors. Invest in Sweden Agency, ISA, attracts and facilitates foreign direct investment in Sweden. Responsible to the Ministry for Foreign Affairs, ISA informs about Swedish advantages and assists foreign companies with facts, advice and contacts when considering setting up business in Sweden. ISA cooperates with a national and international network.