Pyramid Door Formal Case Final Draft

A franchise is a legal agreement between franchisers and franchisees that consents use of the franchise’s trademark and trade name or marketing plan

In 1975 Pioneer maintained relationships with approximately 3,500 franchise retail outlets, the retail outlets benefited from a 5% Pioneer investment in local advertising, and attractive gross margins and credit terms. However, that same year, Pioneer and three competitors were forced to sign consent decrees with the U.S. Federal Trade Commission promising not to engage in alleged anti-fair competition practices – namely requiring distributors to use suggested list prices and punishing those distributors who didn’t comply either through delayed shipments or revoked franchises. A market price war followed the signing of the consent decrees, lowering franchise’s profits while increasing revenue for Pioneer. Pioneer followed

Which strategy should Pyramid Door, Inc. implement, along with increased advertising for 100 dealers to achieve the sales goal of $12.5 million for the year of 2006? The four strategic options are increasing the number of non-exclusive dealers by 100, developing a formal executive franchise with 27 dealers so they would exclusively sell Pyramid Door products, reduce the number of non-exlusive dealers by 100, and the last plan was to only do a better job with current distribution policy and network.

It’s about development of a formal exclusive franchise program, since 27 nonexclusive dealers had posted such a possibility in the last year. Each of these dealers represented a different market, and each of these markets was considered to have a high potential and be a candidate for the new advertising and promotion program.

The franchiser can attain rapid growth for the chain by sign- ing up many franchisees in many different locations.

And franchisors, by design, exert indirect control over their franchisees and franchisee’s employees by way of licensing out the operation of their brand. In traditional franchise agreements, the franchisee is an independent business owner with a license to use the franchisor’s trademarks and other intellectual property as part of a royalty or fee arrangement. The ruling, which states that “setting productivity standards” is a form of indirect control, understandably has franchisors and franchise attorneys seeking shelter.

sales” It is to my belief that in the near future those franchise laws will cease to exist

This is where the money is and the growth is. Their consolidation will in essence allow us to lessen the breadth of our dealer coverage and allow us to focus our sales effort in this high growth area.

They are not closed minded- since a franchise is more like a partnership than a sole proprietorship there

The first choice of business is the franchise. In a franchise, legal binding agreement is entered into between two firms, the franchisor (the product or service owner) and the franchisee (the firm to market the product or service in a particular location). The franchisee pays a certain sum of money for the right to market this product” (Rubin, 1978, p.224). The franchising is more prevalent in the restaurant industry (Hoffman & Preble, 2003). The two distinct features of this business type include; first, in order to notable service components should

It has its advantages and disadvantages to franchise the business. It is a careful decision to make for anyone to invest a lot of money into a franchise and everyone should be comparing pros and cons.

If a new franchise an offer the consumer a quality product at a reduced price, then the chances of success are greatly increased. For example, Chanello’s and Little Caesar’s offer discounted pizza prices, and maintain the same quality as other pizza chains. These companies spend less on advertising and more on the actual product. That’s a very important concept in this industry, because their quality product at this discounted price gives them a niche in the market. Once a company establishes a niche, they become more visible to the

In 1913, Henry Ford revolutionized product manufacturing by introducing the first assembly line to the automotive industry. Ford’s hallmark of achievement proved to be a key competence for the motor company as the low cost of the Model T attracted a broader, new range of prospective car-owners. However, after many decades of success, customers have become harder to find. Due to relatively new threats to the industry, increasing numbers of cars and trucks are parked in dealer lots and showrooms creating an alarming trend of stagnation and profit erosion. Foreign-based automakers, such as Toyota and Honda, have expanded operations onto domestic shores and, in turn, have wrestled

Franchisors are increasingly having to be more and more selective in the adoption of franchisees with factors such as economic climate and the potential difficulty with growth playing key factors in the decision making process. It is not simply an ability to grow which creates a successful Franchise and nor is it the desire of any franchisor to adopt every potential franchisee. Franchisors are becoming more and more scrutinising as the global economy declines. There is a general understanding within any franchised

♦ Reliance on franchising "associate" stores and opening a few new company-owned stores as a means of expanding nationally and internationally. However, franchise licenses were granted only to candidates who have experience in multi-unit food establishments and who possess adequate capital to finance the opening of new stores in their assigned territory.