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How to start a franchise business in Switzerland

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The start-up scene has been booming for several years, and innovative tech start-ups are once again taking the lead. Because of the strong focus on this type of business, another long-established business model has taken a back seat, namely the franchise operation. Since this today offers more than ever good chances, it is worth looking into business opportunities in this field.

Successful franchising depends on the planning

The franchise scene is active and preparing for the new economic era. The increasing number of participants on both sides is the best proof of this. By consulting the Swiss Commercial Register, interested parties can get their own idea of ​​how numerous the opportunities and possible partnerships in the franchise business are. Practically all sectors are present, starting with coffee shops and kiosks over to the fitness and health industry to crafts, real estate or management.

However, it is equally clear that company founders should take a close look at choosing the right franchisor. As with all companies, here too, a lucrative business model doesn’t necessarily have to turn out to be such in Switzerland as well. The first step is to gain an overview of the market position. What are the opportunities and the risks - and what are the competitive advantages of working with the franchisor? This is especially true in terms of investment capital because there are big differences here as well.

In general, financial planning is the central building block of the entire company. Accordingly, the details in the franchise agreement are equally important: factors such as territorial protection can ultimately prove to be decisive for certain businesses, for example for those operating in the catering trade or in books and stationary retail.

Experience has shown that when implemented well, the advantages outweigh the disadvantages

In return, franchisees can enjoy many benefits when choosing the right partner. In the beginning, the differences to single start-ups become particularly clear: the brand awareness ensures a high level of recognition, the corporate image doesn’t have to be brought closer to the target group. The franchisor can also provide useful assistance in strategic processes such as location searches on the basis of his experience. In addition, there are certain requirements for purchasing conditions and the existing network.

To sum up all the features, franchise start-ups are therefore an attractive opportunity that fits in well with today's business environment. As they are well known, large global corporations are gaining ground and exploiting their dominant position in all sectors. For franchisees, this is why the franchise concept is often an ideal middle ground for self-employment a future environment for the development of a large corporation.

Franchising regulations in Switzerland

The franchising industry in Switzerland is not regulated by specific laws. However, if you decide to start the procedure for company registration in Switzerland with the purpose of starting a business in the franchising industry, there are certain rules and regulations that apply to the franchise such as:

  • The Swiss Code of Obligations;
  • The Swiss Intellectual Property laws;
  • The Swiss Civil Code;
  • The Swiss Unfair Competition Act;
  • The Swiss Act on Cartels;
  • Other restraints regarding competition.

There are no legal distinctions made between a franchise business in which the franchisor appoints just one franchise or multiple franchises. As a general rule, these businesses don’t require a specific authorization.

How to incorporate a franchise in Switzerland

Franchises can be operated in Switzerland by any nationals, including by foreign individuals. There are no important restrictions that apply, except for certain activities carried out through the franchise.

Certain activities need to acquire authorization on the local market if they are carried out through a franchise agreement. For example, this is the case of franchises that operate in the banking and insurance sector, in the gambling industry or in the healthcare sector.

A franchise can be incorporated through a franchise agreement just like any other foreign company. The most common legal forms used in Switzerland are the AG and the GmbH. Franchises can also be established as company subsidiaries or branches of foreign companies.

Foreign investors interested in starting a franchise in Switzerland can acquire our services, to receive in-depth consulting and support regarding the legal requirements for company registration applicable in the case of franchising.

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