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Unit 5. Franchise Travel Agencies - Coggle Diagram
Unit 5. Franchise Travel Agencies
Definition
Franchised travel agencies
Franchise
is
A system of collaboration between two independent companies in which one, the franchisor, grants the other, the franchisee, the right to operate a business following uniform commercial techniques.
The franchise
provides
Also the brand and corporate image, know-how, products, employee training, marketing plan and purchasing management. The franchisee will pay a periodic fee to the franchisor.
Characteristics
A good franchise must first and foremost be a proven and transferable success that can be reproduced by the franchisee in its territory.
It is related to the marketing of a good quality product or service.
It gives the franchisee already established in a location a right of first refusal when setting up one or more franchises in its territory.
It provides for an immediate transfer of know-how and effective training of the franchisee in the marketing techniques and methods specific to the franchise in question.
It establishes the modalities of a continuous relationship between the franchisor and the franchisee in order to improve the conditions of operation of the franchise and to exchange innovations, ideas for new products and services, etc.
It expresses the immediate (initial fees) and ongoing (royalty) payments to be made by the franchisee.
Franchisor and franchisee relationship
Its success is based on the relationship between franchisor and franchisee who, while maintaining their legal and financial independence, collaborate jointly in the development of a business that has an impact on the business situation of both.
Franchising
offers an interesting option compared to conventional or controlled vertical structures. Indeed, in a franchised network, the investment of each store is made by the franchisee, owner of the store. From the franchisor's point of view, the creation of a franchise network allows him to have quickly and cheaply an international commercial network without investing directly in the ownership of the network, but controlling it by contract.
Benefits
Rapid and controlled business growth and expansion supported by the drive and initiative of entrepreneurs motivated by their expectations.
Risk minimization, based on the atomization of investment needs.
Simplification of business management procedures, obviously with respect to a proper and extended vertical organization.
The reduction of operating costs, due to the entry of the business into a larger scale economy.
Milagros Camacho 8-870-401
