SOCL 4441 Chapter Notes - Chapter 8: Financial Statement, Franchising, Counterclaim
Document Summary
Has become an increasingly popular retail business: Offers franchisee a turnkey approach to running a business (benefit from pre-determined approach and brand name and supposed success) Turnkey: an already constructed project so that it could be sold to any buyer as a completed product. : a marketing technique whereby franchisor supplies product or service to franchisee who in turn makes it. Franchising available to the public both the manufacturer and the distributor ***(distributors are not franchisors)*** : a manufacturer supplies goods to a distributor who then sell such goods. Product distribution/producer and trade name franchising, which is basically hands off (75% total) Business format franchising - total turnkey package for franchisee - more recent innovation. Rapid growth for franchisor with relatively low capital. Operational duties carried out by franchisees with relatively little franchisor/head office supervision. Profits are maximized through increased motivation since franchisees may be more motivated than conventional managerial situation because franchisees are owners and made significant financial investment.
