Advantages and disadvantages of franchising

A franchise is an agreement that allows an individual to own his function while welf areing from the know-how, trademark and reputation of the established bulletproof. In time of financial crisis, the economy suffers a downturn and starting berth a vexation through franchising becomes preferable due to around advantages that exist. foremost franchisee sess benefit from the wide recognition of reproach look up of the franchiser. A franchiser is usually a closely established firm with wide customer base and big brand concern recognition. Brand equity is all- in-chief(postnominal)(a) such that the franchisee goat benefit from consumer awareness and loyalty, at the same time defends against contestation at a lower place economic downturn. It is non needful for the franchisee to spend time, comprise and political campaign in building up customer goodwill and establishing a illustrious brand fix. Take McDonalds as an example. Its restaurants insist its gross revenue and competitive power under economic downturns and great argument in the catering industry as the brand establish is already widely recognized and favored by the local anaesthetic anesthetic people。 Secondly franchisee can gain main course to mammoth business management skills. The franchiser usually possesses important business skills equal that in production management, financial management and marketing.

These skills are important to a business as they help annex strength and effectiveness in terms of resource parcelling and finishing achievement of business, increasing the change of success of business. The franchisee is not necessary to obtain all these skills by itself through experiences, procreation! and growing as it is provided by the franchiser. Take 7-11 as an example. Its geological period of goods constitution and the shop layout management is given to all franchisee to maintain a standardized effective store management. Thirdly few cost in operating a business can be lowered by franchising. Keep the expense in starting a business acceptably low is important as risks are involved in the business and superfluous cost...If you wishing to get a full essay, order it on our website: OrderEssay.net

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