The franchising becoming increasingly popular because they bring entrepreneurs, full of determination and ideas, into the organisation. For the franchisor is it a advantage to be franchising, because more benefit from economies of scale and they receives a monthly rent based on the sales i.e. the higher the sales, the higher the percentage.
One of the advantages is that the franchisor makes money on the franchisee. Without doing the jobs. They have not a control or management for the other business. And if some business didn’t live up to demand as the franchisor have firm, it will also be an disadvantages. But there is today more advantages, because it is a easy and economic cheap way to extend a business.
It would be that they opened their own restaurants. For example chain restaurants.
The franchisee get right to run, and these include trademarks, designs, equipment layout, specifications of the menu items, stock control, bookkeeping, accounting and marketing.
Because the non-franchise businesses fail, could be because they have problems with for example, cash flow or difficulties associated with overtrading. But a franchises have many advantages, for example they can sell a well established product, they get intensive initial training and continuous support.
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