The Country's Best Yogurt (Tcby) Case Study

Introduction

TCBY has been a frozen treats product innovator from the day its first shop opened in Little Rock, Arkansas in 1981. The great-tasting, low-fat frozen yogurt concept received an enthusiastic response from an increasingly health-conscious public. Its trendy new product propelled the company to the forefront of franchising, and was the ‘first in a long line of ground-breaking menu items that anticipated consumer preferences and continually refreshed the TCBY concept’ (Conlin 2001, p. 133). But TCBY products are just one of the reasons that thousands of operators have concluded that a TCBY franchise is the preferred opportunity in branded frozen treats, and a dynamic partner in any co-branded concept. However, TCBY is facing a lot of problems, both internal and external, during the difficult period from the late 1980s to the early 1990s, especially the problem with its franchising system. The purpose of this report is to provide a comprehensive situation analysis of TCBY, with special reference to its franchising system, and identify several concerned issues of TCBY and its franchisees, and how these issues have negatively affected the relationship between them. Furthermore, this report also provides three recommendations in the attempt to diminish these concerned issues and better maintain the relationship between TCBY and its franchisees, and most importantly, help TCBY to increase the company’s performance and achieve their strategic goals in the next few years.

Environmental scanning

Before the situation analysis of TCBY’ franchising system, it is essential to find out why franchising has become such a problem in this case. This can be achieved through an environmental scanning. Basically, three environ...

... middle of paper ...

...are unavoidable obstacles in the establishment of a good channel relationship in the franchising system, however, if TCBY’s senior management accept and implement our recommendations, hopefully it will help TCBY to survive from the early 1990s crisis and achieve their strategic objectives in future.

References

Brickley, J 1996, Incentive Conflicts and Contractual Restraints: Evidence from Franchising, Journal of Law & Economics, p. 173.

Conlin, E 2001, An Agency Perspective on Franchising, Journal of Financial management, p. 133.

Moore, L 1997, The Flight to Franchising, US News & World Report. June 10, pp. 78-81.

Pelton, L. E., Strutton, D. & Lumpkin, J. R. 2002, Marketing channels: a relationship management approach. McGraw-Hill Irwin: Boston, p. 387.

Pride, W & Ferrell, O.C. 2000, Marketing Concepts and Strategies, Boston: Houghton Mifflin, p. 103.