Summary
Summary OCR a level business chapter 3
Revision notes on chapter 3 of the introduction to business topic, in the OCR a level specification. Franchises and co-operatives.
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Franchises co operativesfranchises a business with a well known brand name the franchiser
lets a person the franchisee or a group of people setup their
own business using that brand
G in exchange for an initial fee and continuing royalty payments for thelength
potymentshire
royalty a certain i of turnover orprofit
FRANCHISES ARE NOT A LEGAL STRUCTURE
iMiddTIMMM
Fifi Iiis
franchisermight recommend a particular structure
ups
S misowattoiirinriroois
aimur
Franchisee person who buys the rights to setup that particular brand
Franchiser
don't have to spend lots of control issues is franchise properly
money to expand following procedures
products necessaryforthefranchise tooperate costof supporting franchises training market
are underfranchiser's direct control research productdevelopmentetc
applicants are carefully selected fortheir support network Mustgrow asfranchisegrows
suitability possibility of conflict franchisee might
blame franchiser if product fails
Should a business franchise its brand Dependson factors like
depends on managers attitude how much timeandmoneythey arepreparedto invest
Fotomat the desired
initial on risk A for rewards
longtermview mightneed to betaken attitude to risk
Advantages for franchisee Disadvantages for franchisee
greater chance of success as it is a tried supplies have to bebought from franchiser might
and tested brand charge more Iprofitmargins
specialist advice and training are available payments
royalty
the franchiser carries outmarketresearch franchiseehaslesscontrol overwhat itisselling howitsells it
marketingsupport business can'tbe soldwithout franchiser's permission
easier to obtain a loan from the bank a franchise is for a fixedperiodof time NOT
automatically renewed
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