This chapter aims to review existing literature relevant to the subject of research in order to gather secondary data and meet aims and objectives of the study, which is to investigate the impact of franchise in building customer relations of new business ventures and to identify the most effective and successful tools provided by a franchise and used by companies in finding new customers and gaining their trust
The section is divided by three main topics, which are franchise business model, benefits of franchise and franchising in real estate sector in the UK. The literature review will identify and describe the franchising form of doing business, highlight and analyse benefits provided by franchise and finally look into…show more content… Franchising as business framework became popular in the middle of nineteenth century in the USA within hospitality service sector (Fulop, 2000; Mansfield & Killick, 2012; Taylor, 2000). Along with globalisation and expansion of the biggest franchisors of the US such as Starbucks, McDonalds and Holiday Inn to foreign markets, franchising as a form of business rapidly entered and became a part of the service sector of the UK (Mansfield & Killick, 2012). The most typical form of franchising is described by the legal right given by franchisor to franchisee to sell goods and services under the franchise brand and to implement existing business model which includes continuous support in return for a fees paid by franchisee (Benjamin et al., 2006; Fulop, 2000; Lashley & Morrison, 2000; Mansfield & Killick, 2012).
According to the literature examined franchisees, it is tend to be represented by larger local firms that are offering a wider range of services and usually are able to generate more revenue than their competitors. Thus, franchisors are enhancing revenue generation process by adding additional value through standartised systems of marketing, training, learning branding knowledge and technology sharing (Benjamin, Chinloy & Winkler, 2007; add more ref). There were a lot of studies conducted in order to justify reasons of franchise business model existence and its success (Anderson & Fok, 1998; add more ref).