Advantages and disadvantages of franchising

A franchise is an agreement that allows an individual to own his employment while welfareing from the know-how, trademark and reputation of the established bulletproof.
In times of financial crisis, the economy suffers a downturn and starting line a business through franchising becomes preferable due to some advantages that exist.
foremost franchisee can benefit from the wide recognition of brand look up of the franchiser. A franchiser is usually a well established firm with wide customer base and great brand concern recognition. Brand equity is all-important(a) such that the franchisee can benefit from consumer awareness and loyalty, at the same time defends against rivalry at a lower place economic downturn. It is not needful for the franchisee to spend time, comprise and political campaign in building up customer goodwill and establishing a famous brand fix. Take McDonalds as an example. Its restaurants maintain its gross revenue and competitive power under economic downturns and great competition in the catering industry as the brand name is already widely recognized and favored by the local anesthetic people。
Secondly franchisee can gain access 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 increase strength and effectiveness in terms of resource allocation 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, training and growing as it is provided by the franchiser. Take 7-11 as an example. Its flow of goods constitution and the shop layout management is given to all franchisee to maintain a standardized effective store management.
Thirdly some 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 excess cost...If you wishing to get a full essay, order it on our website: Orderessay



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