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Franchising Vs New Business

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Address the following questions in a three to four page paper:

1. Go to the library or search the Internet for information on "franchising." Compare and contrast franchising with starting a business from scratch. Be sure to consider management, finance and accounting, and marketing viewpoints.
2. How might the corporate culture of a franchised location differ from that of a non-franchise (e.g., Subway versus Joe's Subs)? Why? Be sure to consider all of the various aspects of corporate culture and the potential ethical and legal issues.
3. Consider Exhibit 9-3 in the textbook, and think about a fast-food restaurant that you are familiar with. Which layout do they use? Is this the best layout for their business? Is this the layout you would choose? Be sure to defend your answers.

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The response addresses the queries posted in 1906 words with references.

//As per the instructions of the assignment, firstly we have to analyze the concept of franchising and its importance to start the business at a new place. This material will help us to explain and compare the performance of the business running through franchisee and new business. The example given by me is well enough to assist you to complete this assignment. You can put more information according to your knowledge. //

Solution1. Franchising is a form of licensing in which a parent company (the franchiser) grants some other independent entity (the franchisee) the right to do business in a prescribed manner. (What is Franchising?) This right can take the form of selling the franchisor's products, using the name, production and marketing techniques, or general business approach. One of the common forms of franchising involves the franchisor supplying an important ingredient (part, material, etc.) for the finished product, like the coca cola supplying the syrup to the bottlers.

Usually franchising involves a combination of many of the elements mentioned above. The major forms of franchising are manufacturer-retailer systems (such as automobile dealership), manufacturer-wholesaler systems (such as soft drink companies), and service firm-retailer systems (such as lodging services and fast food outlets). (What is Franchising?)

Franchising Vs new Business

If a new business is started, it has to be established; while in franchisee, there is an advantage of working under the brand image of the franchisor. Franchisor helps and advices in searching appropriate office/store locations. There is a requirement of high investment if the business is established independently; while in franchising, less capital is needed as expenses are reduced due to strong buying power. New business requires complying with various rules and ...

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This response addresses the queries posed in 924 Words, APA References

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Franchise Agreement vs Own Business: Liz wants to own an organic store.

Liz Strong thought she'd been a librarian long enough, and when the opportunity to open a small organic convenient store in the newly renovated downtown business district arose, she was ready to act. Foods of Reality is a franchisor of organic food shops, and was founded five years ago by a noted certified nutrient specialist in New York City. The concept for the shops is simple, yet sophisticated. It is simple in the sense that the shops sell only organic-related products, but sophisticated in the breadth and quality of the inventory they carry. Each franchise, depending on size, is stocked with inventory selected by the company's founder. The franchisor finances the shop's initial inventory. The franchisee is expected to create a decor within predetermined standards that Foods of Reality establishes. Each franchisee must attend a three-day workshop, outlining the fundamentals of organic food, the merchandising of the different types of organic foods, and the techniques of successful business operation.

The franchise contract requires the franchisee to contribute 1.5% of gross revenue to a national advertising campaign. According to the contract, Foods of Reality will finance the required fixtures for the store for ten years. Also, the franchisor supplies all inventory at very favorable prices because it purchases in large quantities.

Liz knows she can buy organic products from a variety of wholesalers. She also has some ideas on what would make an organic shop successful in this town. Liz knows that Foods of Reality franchisees have had a high success rate in the past.

Help Liz make a decision by outlining the advantages and disadvantages of a franchise agreement. Assuming that Liz has adequate capital, would you recommend that she invest in the franchise or open her own organic foods shop? Why?

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