|Type of paper:||Essay|
|Categories:||Branding Strategic management Business plan Business strategy|
A franchise is a business built based on a market concept where an already established company sells its rights to its business model, name, trademarks, and logo to the new business. The franchisor is the already established organization that allows an individual to run a location of their business, whereas the franchisee is the individual that operates the company under the franchise's brand. In my paper below, I will tackle in detail various aspects of franchising.
Franchising could be an opportunity for growth both for the franchisor and the of the franchisee. Focussing on an entrepreneur who opts to work as a franchisee, their growth potential tends to be higher because of various reasons. These include; the franchisee has full self-rule to execute their strategy and marketing in operations involving their business entity. They can also enlarge their business by the opening of various new locations, and they also get to regulate their market on a local level (Daszkowski, 2018).
The franchisee may also have the privilege of quickly gaining a customer base since he offers already popular products. The only thing the franchisee has no control over is the product or service, the innovations, the international marketing of the product or service and often the pricing. This can get viewed as a burden off an entrepreneur opting to work as a franchisee. (Business QueensIsland, 2016).
According to Barringer and Ireland, the term franchise gets derived from the French word that dates back hundreds of years, meaning freedom (2016). Therefore, it implies that the franchisee can introduce various aspects to his business that aid in its growth. For instance, the franchisee may decide to indulge in the surrounding community activities, thus able to market its' products and services in the community level.
Even given that this is true, the entrepreneur who is franchising gets limited in his ability to pursue different types of growth strategies. This entrepreneur has no room to be creative. They perform their operations and run their business according to how the franchisor wants it to get done. This is because the franchisor typically already has a set reputation he gets to protect (Barringer & Ireland, 2016).
Another point of interest is; is being a franchisee merely substituting one type of employment for a different kind of employment? I will answer this based on my own experience. I worked at Tim Horton's as a teenager. The franchise's growth's prospects are singly dependent on the store's performance. The individual owning the store incurs the losses, he carefully factors in the risks, incurs all expenses aimed towards investing in the business and is fully responsible for the growth of his business (Elgin, 2006). Given this, I can say that being a franchisee is not the same as being employed.
Being an entrepreneur, the ultimate question one asks themselves is how they can grow their business. If they work as a franchisee, they can improve their business by; getting to market their products widely thus have an established customer base. The franchisee also gets to employ various growth strategies they deem necessary for the growth of their business (Barringer & Ireland, 2016). These strategies include; addition of more units to the business. Grossmann affirms that the owners of the multi-unit franchise have some of the most successful business (2017). The franchisee also has the privilege of associating with proven products and methods.
In conclusion, it is clear that venturing into franchising as an entrepreneur has its advantages that override the disadvantages.
Barringer, B. R., & Ireland, R. D. (2015). Entrepreneurship: Successfully launching new ventures (5th ed.). Don Mills, Canada: Pearson Education Inc.
Business QueensIsland . (2016, June 23). Advantages and disadvantages of buying a franchise. Retrieved from Business QueensIsland : https://www.business.qld.gov.au/starting-business/buying-business/buying-franchise/advantages-disadvantages
Daszkowski, D. (2018, December 5). Franchise Marketing. Retrieved from the balance small business: https://www.thebalancesmb.com/franchise-marketing-1350412
Elgin, J. (2006, January 2). Entrepreneurs as Franchisees. Retrieved from https://www.entrepreneur.com/article/82994Grossmann, R., (2017). Smart Tips for Growing Your Franchise. Retrieved from https://www.entrepreneur.com/article/289094
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