The Pros And Cons Of Franchisees

1. Franchisees gain numerous advantage when they purchase a franchise. First, while a franchisee may be opening a new store, it is part of an already established business and system. This means a franchisee has access to turnkey operations, allowing an increased speed to establishing and growing the business. Franchisees also get support for management and training activities, as well as financial assistance. Going hand in hand with this, a franchise already has an established brand name, quality of goods and service which have been standardized across the franchisor’s larger company, and national advertising programs from franchisors. Franchises also have large-volume, centralized buying power. A franchise has proven products, and

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

Franchise is treated as a form of business that is more popular during the present context. Its popularity has to do with its proven track record of success,

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

This Literature review explains if a franchise is high or low risk way of entering into a market. It also explains whether a franchisee is suited for a certain franchise. Franchises can be seen all over the world, with everyone being introduced to them, as consumers, from a young age (Longenecker et al., 2011). Thomas and Seid (2000) agree with this and believes due to it, people think they understand a lot more about a franchise than they actually do, creating myths about the rate of success and the ease of entry. Antitrust Law and Economics of Product Distribution (2006, p.5) defines a franchise in a 3 part way as, “(1) a franchisee (a) offers, sells or distributes a franchisor’s goods or services, which are identified by

The Advantages and Disadvantages of Franchising in France 1 Running head: International Trade: Licensing and Franchising The Advantages and Disadvantages of Franchising in France Presented by: Deon E. Boswell Of Team McWorld University of Maryland University College AMBA606 November 4, 2005 The Advantages and Disadvantages of Franchising in France 2 Executive Summary The tremendous growth in franchising over the last decade can be traced directly to the explosion of growth in international trade and globalization. As organizations, attempt to enter new markets they are finding that direct investment via subsidiary creation is an expensive proposition and that their capital expenditures could be used for other opportunities

Franchises are across the world and their growing. places such as McDonalds,7eleven and Burger king have been around for a while, and will continue until the day the world dies. A franchise is a business relationship in which a franchisor grants a license to use the name of the business calling him the franchisee. To become a Franchise is not an overnight task Capital has to be raised to purchase a franchise. Most franchises can be up to one million dollars or more. After raising capital, a franchise can be purchased, but there are rules and regulations that must be followed. Franchisees have duties and responsibilities they have to account for. Then the franchise agreement that needs to be followed to the letter.

The franchise model requires regular payments to the Subway Corporation. This will eat into profit margins each year and decrease the potential upside that might have been realized from running a standalone restaurant. However, it will also allow the owner to build equity in the restaurant, and enable the potential sale the restaurant at a later date if it is successful (Amit & Zott, 2012).

Franchising is one of the most popular methods adopted by firms to grow their business, and Fast-Food franchises are the most successful and leading sector in the franchise business. This report examines whether Fergburger, a fast food restaurant, catering to the gourmet sector has the potential to franchise their business locally and globally. The advantages and disadvantages, to both the franchisor and franchisee are explained and the criteria that is required to ensure whether Fergburger is indeed a franchisable firm, is described in detail. Fergburger has the potential to franchise, mainly due to its popularity, and as gourmet burgers are a trending preference amongst customers, although Fergburger’s have been declining offers from potential franchisees.

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

It’s first important to understand some of the responsibilities of a franchise owner. In general, a franchise owner is responsible for a specific location, or branch, of

Sometimes the costs we spend for the franchising may be huge than if we begin our own one from the scratch. Because we may have to pay for marketing, advertising and agreed percentage of our sales than the initial cost. Then sometimes they will go for loans for further development. If the franchise go for down. It will

Regrading the staff recruitment within franchises, only franchisee is responsible for this task. Furthermore, franchising increases market penetration, it means franchisees appear to be part of local community and this gives them an opportunity to gain new business. International potential is also included in franchising list of advantages. If a company has serious intentions to expand its business internationally, franchising multiplies chances to achieve such a goal. It allows to adapt the business to the foreign market. As a result, it is obvious that there are numbers of reasons why franchising is useful and beneficial for business(“Reasons For Franchising Your Business”,

The purpose of this paper is to shed some light on the concept of franchising from the viewpoint of the franchisor, discuss its different uses taking into account the advantages and disadvantages attached to them, and link these considerations to a firm’s internationalization decision-making process.

Franchising is quite different than other industries because two entrepreneurs are involved in it and their relationship is vital for success. The franchisee needs the right tools, guidance, and a respectable amount of money in order for him or her to generate the appropriate profits to make the franchise worth the investment. However, franchisors must also be ready to assist their franchisees with all of the tools and guidance they need to make them successful. Mark Siebert the CEO of