Which of the Following Is an Advantage of Franchising

Reduced expenses as the franchisor provides supplies. The selling power of a known brand.

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I Franchising makes the task of getting started easier because the franchisee gets a business format- already market tested and found to work.

. Branding is a huge responsibility that has the ability to make or break a company. Franchisee holds much power including superior bargaining power Points out of 7 Flag question O b. Involves the chances of friction between two parties due to payments agreement and surprise inspections by the franchiser.

In franchising someone has already done the work of developing and establishing a viable business system. Economics questions and answers. Under franchising the franchisor gives to the franchisee a kind of licence which gives the franchisee access to method trademarks and proprietary knowledge of the franchisor so that the franchisee can sell a commodity under the name of the franchisors business.

Involves fluctuations in the cost structure of the franchise as different countries have different laws. As well as the initial costs of buying the franchise you pay continuing management service fees and you may have to agree to buy products from the franchisor. Operations Management questions and answers.

If the franchise is already a household name then this is one of the best benefits of franchising. Goof- ups have dragged many companies down whereas a good promotional policy has proved a saving grace for others. Under franchising the service provider develops the business format and licenses it to others.

B It is a low-risk low-cost entry strategy. Limited capital is needed to start d. Use of a well-known recognizable brand name O c.

Franchising provides a better mechanism for selecting and offering incentives to outlet operators than salaried employees. Makes it difficult for the franchiser to manage franchisees due to increasing number of franchises. Shorter time to opening.

Franchising offers an efficient mechanism for obtaining human and financial resources for rapid firm growth. 61 Which of the following is an advantage of franchising to the franchisor. 31 You can choose a franchise from several industries.

Following are for example the distinct advantages that franchising provides to the franchisee. Lower costs through group purchasing. A higher chance of success than in a sole proprietorship.

Franchisee pays for assistance from franchisor. In addition franchisees can grow faster because the franchisor does not have to hire staff which reduces their costs. For franchisees benefits include.

1 The power of the existing brand. Assistance in finding an optimal site. A It is easier to maintain control over a franchisee.

34 You will be introduced to suppliers. 91 of franchisors chose to franchise in part bc it allows control of their firms Human resource acquisition Franchising allows a firms management to specialize in identifying selecting and training franchisees. Franchising is advantageous to both franchisee and franchisor in the following ways.

It is easier to saturate primary and tertiary markets with franchise locations because the franchisee performs the necessary leverage in terms of finances personnel and more. The primary advantages for most companies entering the realm of franchising are capital speed of growth motivated management and risk reduction but there are many others as well. One of the major advantages of franchising is that is allows for accelerated expansion of your company.

The franchise agreement usually includes restrictions on how you can run the. 35 You get support all the way. Read more advantages of franchising.

Not yet answered Select one. D There is seldom a requirement for the franchisor to become familiar with foreign laws and regulations. 3 Advantages of Owning Franchise for Franchisees.

The main benefit of becoming a franchisee is that the business will have an established product or service. Franchise agreement gives control to franchisor b. A firm is relieved of many of the costs and risks of opening a foreign market on its own.

Use of an established business model. Franchise agreements are not uniform c. 32 You are guaranteed lower risks.

Hence buying a franchise is so far safer than trying to start a business. 2 Benefits and Risks of Buying a Franchise. Which of the following is an advantage of franchising.

A franchisor expands his business through franchising as it offers certain advantages. Which of the following is an advantage of franchising. Since the franchisor does not invest in its own units the franchisor does not have to worry about the success or failure of the franchised units.

The most common barrier to expansion faced by todays small businesses is lack of access to capital. 33 You wont have a hard time introducing your brand to your customers. Costs may be higher than you expect.

Start studying Advantages and Disadvantages of Franchising. A firm takes profits out of one country to support competitive attacks in another. The primary advantages for most companies entering the realm of franchising are capital speed of growth motivated management and risk reduction -- but there are many others as well.

Another advantage of a franchise is its ability to grow quickly and easily. The most common barrier to expansion faced by todays small businesses is lack of access to capital. Initial training and ongoing support.

C There is seldom any risk of franchisees becoming future competitors. Question 8 Which of the following is an advantage of franchising to the franchisee. Learn vocabulary terms and more with flashcards games and other study tools.

Therefore an advantage of franchising is that it can help the franchisor expand his or her. Its no surprise that many people considering opening a business of their own turn to franchising as there are a number of advantages to joining this industry. Eight disadvantages of franchising.

It guarantees consistent product quality and achieves experience curve and location economies.

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