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Advantages and disadvantages of franchisee / franchisor - Coggle Diagram
Advantages and disadvantages of franchisee / franchisor
Franchisee
Advantages
Product exists and is usually well known.
Format for selling the product is established.
Set-up costs are reduced.
Secure supply of stock.
Franchisor can provide legal, financial, managerial, and technical help.
Disadvantages
Unlimited liability for the franchise.
Pay royalties to the franchisor.
No control over what to sell.
No control over supplies.
Franchisor
Advantages
Gains quick access to wider markets.
Makes use of local knowledge and expertise.
Doesn't assume the risks and liability of running the franchise.
Gains more profits and sign-up fees.
Makes all of the global decisions.
Disadvantages
Loses some control in the day-to-day running of the business.
Can see its image suffer if a franchise fails or doesn't perform properly.