PowerPoint Presentation

Franchising is a smart business solution. Denise Nadal (20000951).

Introduction. Franchising is the first choice as a business starter for people wanting to get into business has grown over the years and has been at the same time, providing employment to a lot of communities (Stanworth, J et al., 2004). Franchising is generally defined as a commercial relationship based on a licensing agreement between two independent companies.(Gillis & Castrogiovanni , 2012). When franchising a business, all a franchisee has to do is provide resources for the capital, which includes the business space, equipment and the franchising company deals with hiring manpower, and management training. In fact, research says, there is a ninety percent success rate for franchise businesses than failure and according to a seven-year research study, 91 percent of franchise businesses are still operating (How to attract franchise investors, 2017) which clearly shows that franchising a business is a smart business solution than building a business of your own..

Financial Differences. 5. Argument. In owning a franchise business, they have to pay royalty payments which means, paying a percentage of the monthly gross to the franchisor which reduces profit potential wherefore when owning a business, all of the profit goes directly to the business owner and is up to their discretion whether to keep it or let the cash stay afloat for the business..

Justification. 5. Mcdonald’s revenue has even grown drastically in Northern America in the last 5 years (Statista, 2022) which directly accounts for that even with the existence of royalty payments for franchise businesses, franchisees are still getting higher profit and it doesn’t serve as a hindrance even for potential franchisees..

Corporate Rebranding. 5. Argument. Lack of communication in terms of corporate rebranding has been an issue with big franchise companies like Dominos, Subway and even Mcdonalds in fact, these companies have had very public disputes regarding this matter since (Mitchell, 2018). The main focus for the most part has been at the item brand level on the grounds that typically the goal is to have the option to adjust or expand the brand's current affiliations and furthermore adjust the new picture to new affiliations though not continuously fruitful ( Bamfo, et al., 2018)..

Justification. 5. It is automatically concluded that when new policies or changes in the brand are done, it will be directly brought down for implementation, understanding that assessments or trial and error has already been done..

Marketing / Advertising Cost. 5. Argument. Marketing and advertising that is to be paid to franchisors has been one of the issues of franchisees and even potential franchisors..

Justification. 5. It is through it that the public are able to recognize the business and cause higher sales and profit. Brand mindfulness should be a significant objective of the showcasing interchange endeavors of a firm as it has various significant capacities. It is broadly recognized that without brand mindfulness happening, brand demeanor and brand picture can't be shaped (Macdonald & Sharp, 2003)..

Conclusion. 5. Franchises allow businesses to compete with much larger companies and saturate the market before competitors respond. Franchises can help businesses grow on both sides of the fence. The main advantage of a franchisor is that you can quickly grow more business in different locations. It may seem like for franchisees that they are being controlled by franchisors but in reality, everything is laid out for them and all they need to work on is monitoring managers and supervisors of their franchise stores. Therefore, it is a smart business decision to franchise a well-known brand than to create a brand of their own..

References. 5. Bamfo, B. A., Dogbe, C. S. K., & Osei-Wusu, C. (2018). The effects of corporate rebranding on customer satisfaction and loyalty: Empirical evidence from the Ghanaian banking industry. Cogent Business & Management , 5 (1), 1413970. https://doi.org/10.1080/23311975.2017.1413970 Gillis, W., & Castrogiovanni, G. J. (2012). The franchising business model: an entrepreneurial growth alternative. International Entrepreneurship and Management Journal , 8 (1),75-98. How to Attract Franchise Investors . (2011, February 17). Franchise500. https://www.franchise500.com/article/79492.

References. 5. Improving Unit Network Profitability and Performance . (2015, January 23). IFA. https://www.franchise.org/franchise-information/operations-training/improving-unit-network-profitability-and-performance Macdonald, E., & Sharp, B. (2003). Management perceptions of the importance of brand awareness as an indication of advertising effectiveness (Doctoral dissertation, Massey University, Department of Marketing)..

References. 5. Mitchell, S. (2018, May 4). Domino’s, Retail Food Group accused as franchise inquiry gets under way . Australian Financial Review.https://www.afr.com/companies/retail/dominos-retail-food-group-accused-as-franchise-inquiry-gets-under-way-20180504-h0zmku Stanworth, J., Stanworth, C., Watson, A., Purdy, D., & Healeas, S. (2004). Franchising as a Small Business Growth Strategy. International Small Business Journal: Researching Entrepreneurship , 22 (6), 539–559. https://doi.org/10.1177/0266242604047409 Statista. (2022, February 25). Franchise sales of McDonald's 2006–2020. Statista . https://www.statista.com/statistics/820471/mcdonald-s-franchise-sales/.