advantages and disadvantages - franchisee?

Answer 1

Advantages of Franchises:

One of the major advantages of franchises is the established name recognition it provide to the business. If a small business is associated and linked with a big-business then there is a high probability that the small business would propel due to the firm backup and support of an established big business. Running a small business under the franchisor's name and organization is very beneficial for businesses that can’t afford much finance and capital investment for their own business.

Another major advantage of franchises is that when a business is associated with a franchisor then the big-business themselves help in corporate marketing of the small industry or business they are providing support for. Having the interest of big-budget industries in a low-budget business is a very effective marketing tactic and these franchises policy ensures the proper marketing of a small business.

An advantage of franchises is the bulk purchasing power it gives to small business and industries. Since most of the initial financial burden is provided to the business once it’s franchised by the franchiser therefore this enables the business to buy equipments, products and other necessities to run the business with ease and without worrying about the financial investment.

A major advantage of franchise is the training and management facilities the franchisor provides to the business. A company which provide capital and investment to any small business have vested interest in the success of the small business. Therefore the companies that provide franchise ensure that the business in which the money is being invested is run and manage properly. The big-businesses and industry provides all the necessary training to the small business staff and provide additional resources and decision-making capabilities to a small business.

Disadvantages of Franchises:

Disadvantage of franchises includes the indulgence of a big-business into a small business. The creative control that a small business owner have is often hinder when franchising in done. Any decision which is to be made is to be consulted and approved by the franchisors. This limits the authoritative control of the small business owner to a great extent.

Another disadvantage of franchises is reaching a general agreement on terms and conditions. There are several occasions when the term and conditions imposed by the investors and franchisors are biased and getting a firm deal with the companies safe-guarding the interest of both parties is a complex task.

A disadvantage of franchises is that the much time is required while selecting a franchise. A complete and through research is required to select the right franchise and to determine whether it would work for the business or not.

Another disadvantage of franchises is that this is a complex procedure and there are numerous instant during the business when heated discussion and disputes occurs between the small business and franchisor.

Answer 2

Advantages And Disadvantages Of Franchising

Answer 3

Advantages Can use a ready made business model. Can benefit from an established brand name. Can benefit from practises adopted by other franchisees since it is directly relevant to you. Can take advantage of the huge marketing budget and resources that you might not be able to afford on your own Disadvantages Cannot decide what direction the business will take Cannot change the product portfolio Usually involves a huge set up fee Have to pay commission to the main company

Answer 4

Franchise's are fantastic.

The biggest advantage is that you have a proven business system that you know works. If you follow everything they say your success rate is very very high. There hasn't been a McDonalds franchise fail in about 40 years because it is a proven system.

I guess the disadvantage is that you can't vary from this system too much.

I hope this helps.....

Cheers, ToNy!
"Success.Trail"

Answer 5

Franchise business constitute 80% of the world business.
Franchise is of 2 types.
1st Public Franchise and 2nd Private Franchise.
Public Franchise is single level marketing with heavy initial Investments and high running costs and has to be run like traditional business. The famous name includes MacDonalds, Subway, Bata, Pizza Hut, dealership of any Automobile, Hilton Hotels etc and the main owner [Franchisor] always has TIME,MONEY and SECURITY and they invest in other time compounding businesses which give great incomes.
Private Franchise is also called Network Marketing/Multi Level Marketing/Direct Marketing with Low investments and low running cost and after certain time that running cost is also free as Income is high and residual. The retention rate in this business is like any other Traditional business.Still Private Franchise has produced many Multi Millionaires in the world. www.alticor.com and www.marykay.com and www.herbalife.com and www.sunrider.com and www.foreverliving.com are few names in private franchise business.
Here is no 1 Private Franchise company/MLM http://www.forbes.com/lists/2006/21/biz_06privates_Alticor_B15P.html
Here is no 2 Private Franchise company/MLM
http://www.forbes.com/lists/2006/21/biz_06privates_Mary-Kay_9ETL.html
Here is no 3 Private Franchise company/MLM
http://www.forbes.com/lists/2006/21/biz_06privates_Forever-Living-Products-Intl_4L21.html

Answer 6

franchisee fees each month

mandatory store changes every few years to upgrade the look

Answer 7

that's arguable and there are actually more than one potential answers to the question

Answer 8

read more http://www.shaklee.net/qualitylife/distMain