A Franchise (Leaving Cert Business): Flashcards
📚Flashcards
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Practise the cards
10 cards from this deck
Definition of franchise
Definition of franchise
Licence to sell products under franchisor's brand for fee
What franchisee pays franchisor
What franchisee pays franchisor
Fee + percentage of turnover or profits
Formation requirement for franchise
Formation requirement for franchise
Purchase licence from franchisor
Who assumes liability in franchise
Who assumes liability in franchise
Franchisee (financial & legal)
Who controls franchise operations
Who controls franchise operations
Franchisor maintains significant control
Franchise advantage: business model
Franchise advantage: business model
Established brand & proven model reduces risk
Franchise advantage: franchisor support
Franchise advantage: franchisor support
Market research, training, ongoing support
Franchise advantage: economies of scale
Franchise advantage: economies of scale
Bulk purchasing & collective advertising at lower costs
Franchise disadvantage: costs
Franchise disadvantage: costs
High start-up costs & ongoing royalties
Franchise disadvantage: creativity
Franchise disadvantage: creativity
Limited ability to innovate or alter business model