Franchising Case Study

857 Words4 Pages
In modern days,business models are expanding through out the world and one of the most known business model is franchising. Franchising has shown a dramatic growth since it offers many significant advantages when compared to other distribution methods. When a new entrepreneur starts investing into business,it is necessary for one to consider the pros and cons of all option. The best method to achieve success is to venture into a franchise. This is because franchise system is able to gain more capital without encountering a significant number a bills for rents,staff and credit intrigue which tend to deplete away the profits of conventional business (Stanworth,2004,p.554). It can be identified that franchising comes out with more advantages…show more content…
According to Salar and Salar (2013),after franchise was published,all of the famous restaurants such as McDonald started to franchise in 1955 and,oil refineries and auto manufactures began to franchise to distribute their products in different parts of the country. It provided opportunities for small stores and restaurants to outshine and rise more capital.Franchising are also able to help a business by gaining access to external capital that can develop finance of new outlets that are run by franchisees(Frazer,Merilees,& Wright,2012). In addition,there may be some drawback of franchising but there are more benefits of venturing into a franchise. First and foremost,franchising contains an easy setup. “According to Cavaliere and Swerdlow,the franchisee get its entire format from it’s franchiser ” (Salar & Salar,2013,p.517). For example, operating structure and marketing strategy will be well planned for franchisees. The new store or outlet is needed to be adjust to the picture that the franchiser has effectively set up,such as,the main theme image and the furniture that gives the same launch to customers. In consequence,franchisee will not need to have worries of poor marketing statement as it has been covered up by best
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