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Business Studies Chapter 4: Franchise (Private Sector) (contribution of…
Business Studies Chapter 4: Franchise (Private Sector)
contribution of franchisee
capital
management
enterprise
franchisor
advantages
franchisee buys license from fanchisor to use brand names
much faster expansion of business
management of outlets is not their responsibility
all products sold obtained from franchisor
disadvantages
bad management of an outlet leads to bad reputation
franchisee keeps the profit
franchisee
advantages
all supplies obtained from franchisor
reduced business failure chances
franchisor pays for advertising
fewer decisions needed to be decided
management training provided by franchisor
banks often willing to lend them money
disadvantages
less independence
may be unable to make decisions suitable for local area
payment of license fee to franchisor
franchise business
business based upon
use of brand names
promotional logos
trading methods