15 August, 2011

Why would franchising have an image or reputation, among some executives as being inefficient and encouraging little control?



Franchising has become so successful because it allows the franchisor to expand the business boundaries using another person’s capital and to exploit the franchisee’s local knowledge and willingness to work hard. Likes,Training, national and regional advertising, operating procedures and operational assistance, supervision and management support, increased spending power, access to bulk purchasing and economies of scale. Statistics vary widely on the success/failure ratio of franchised versus non-franchised startup businesses, but franchises invariably come out on top. An established product or service having consumer acceptance, being free of worries about traditional startup costs, such as developing a market Presence, The availability of managerial and technical assistance, Franchisor oversight of quality control standards, Economies of scale/quantity-inventory to carry, Minimize financial risks, Central reservations system & chain directories.

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