Literature Review 'Business Viability: A Comparison Between Franchising'

701 Words2 Pages
bulb-icon

Recommended: An essay about advantages of franchising

Literature Review
“Business Viability: A Comparison Between Franchises and Independent Business” by Lewis (2009) aims to investigate the advantages and disadvantages that are experienced by the entrepreneur as the owner of an independent small or medium enterprise, or franchise business and its environs. Business opportunities can mean different things to different people. While all franchise and independent businesses for sale are business opportunities, not all business opportunities meet the requirements for being franchises, nor are they in the strictest sense independent businesses. SMEs and franchise businesses are part of a vibrant and growing sector in most economies round the world. Specifically the study came out with the following …show more content…

Entering into a business in general can be quite a challenge especially when an entrepreneur still lacks enough knowledge and experience in business. The study came up with a model that would determine if the franchise will succeed or fail. The researchers also cited some of the factors that may affect the economic sustainability of the franchise. The experience background of the franchisor contributes greatly to the viability of the business because: first, franchise business concepts are developed by the franchisor in a standardized manner although these concepts are subject to change by acquiring a first-hand experience with meeting the clients and adapting to their needs and; second, with the experience acquired by the franchisor through the years, the risk of committing errors are less likely to …show more content…

al (2014) entitled “Factors Influencing Entrepreneur Choice of Franchising as a Business Model: The Case of Mankweng Township in the Limpopo Province of South Africa” states that the entrepreneurs who are inclined to have franchising as a business type are influenced because of its established benefits. These are prior performance record, recognizable company name or brand, successful business model, and business training and management program. It is also stated that the intrinsic managerial skills of the entrepreneurs are important to be successful in franchising business in the province of Limpopo, South

Show More
Related

  • Family Dollar and Dollar General

    1085 Words  | 3 Pages

    Philip Lief Group and Lynie Arden. 220 Best Franchises to Buy: The Essential Sourcebook For Evaluating the Best Franchise Opportunities. New York, NY: Random House, 2000. Print.

    Read More

  • Pocasangre Oliva Dental Case Study

    1787 Words  | 4 Pages

    As with many small business owners they vision of their business usually only extends to their own abilities. They are driven and full of determination and believe their abilities will be able to sustain the business to success. Unfortunately, many small businesses lack the knowledge to be able to effectively be owners’ and leader’ to their organizations.

    Read More

  • Pepsico Restaurants Case Analysis

    1635 Words  | 4 Pages

    Senior Management of PepsiCo is evaluating the potential acquisition of two companies – Carts of Colorado and California Pizza Kitchen – in order to expand the company’s restaurant business. If indeed PepsiCo decides to pursue the acquisition of one or both, they must decide how to align each of these business units in its historically decentralized management approach and how to forge relationships between the acquired business units and existing business units. In their evaluation, Senior Management is faced with the question of whether the necessary capital investment in order to purchase one or both of the businesses can be profitable for each of the acquired business units, but must also take into consideration that the additional business units will not hinder the profitability of the existing business units.

    Read More

  • Pizza Boom Analysis

    778 Words  | 2 Pages

    I know this from my own family owning business and can bring this knowledge to the pizzerias that are evolving into more of a modern state. Competition between business that seek the same things can become a problem as well. LIke the in tethered source the article is talks about the franchise pizza chain Papa John's making a restaurant right next to the family owned business Johnny's PIzza. The family owned business finds this as an insult and want them gone. Losing customers is problem that can occur as it says in the article and the family owned business is starting to worry. In The article it states “The people who come the Johnnys now will keep coming to Johnny's”. This shows that people will only find one of jind pizza at a family business and it won't matter if they have another place next to them they will still have their customers. We can also sue the picture to make an inference Bcaas of the runned down look of the place we can tell the wonders could be nervous because if the appeal since the big businesses will have a more up to date look on things and service wise as well. Another big aspect into owning a business is paying the employee's. SMall business might not get as much business as big franchises and bring the prices uo might occur so they can pay their employees. IN source three it states “When it's time to raise

    Read More

  • Case Study: Panera Bread Company

    1276 Words  | 3 Pages

    Demand for Panera franchising opportunities was very high, which allowed Panera to be picky about where and with whom they would do business. Panera determined where bakery-café locations could be. The franchisees bore the cost of opening new locations, and were required to obtain their ingredients from the home company. Expansion using the franchise model provided many upside benefits for Panera, while limiting the downside r...

    Read More

  • Mcdonalds: An Example Of Product Diversification For Mcdonalds

    1103 Words  | 3 Pages

    This video provides an overview of product diversification. It explains that there are two types of diversification, which are related diversification and unrelated diversification. In addition, the video informs that diversification often involves merger and acquisition activities. Furthermore, it stresses the importance of keeping diversifications balanced, as in some instances, companies that do not take advantage of diversification, can miss out on some benefits, and/or could experience negative effects. However, on the other hand, the opposite could also occur, because some companies that over-diversify, extend themselves too far and can experience detrimental and disadvantageous effects as well. The key is staying

    Read More

  • Pet Supplies Plus Essay

    743 Words  | 2 Pages

    One of the best advantages of becoming a franchisee is that one can own his own business without having to experience the failure that is prevalent with startups. In addition, a franchisor provides an entrepreneur with a successful business plan and a name that is recognized by consumers. As a result, the franchisor will normally provide the franchisee with the necessary training to help the overall business to succeed. Since Professor Keevan has no prior experience with running a business, the benefits he would derive from owning a franchise are quite obvious. While the startup costs to obtain some franchises can be quite excessive, some franchisors do offer in-house lending to their franchisees.

    Read More

  • International Expansion: A Feasibility Study

    908 Words  | 2 Pages

    The marketing team of International Consultants Inc. (ICI) began an analysis of the feasibility of expanding the sales of American Training Incorporated (ATI) products into international markets. Mexico and Canada appeared to be the logical initial markets; however, the study showed that other Latin American country should also be considered further

    Read More

  • Burger King: Selling Whoppers in Japan

    1384 Words  | 3 Pages

    Another strength is Burger King’s franchise development having 90% of its restaurants franchised. The franchise concept allowed the company to grow with minimal capital expenditure and receive royalties and fees. Burger King went above and beyond and created a new model of its restaurant to attract mo...

    Read More

  • A research Proposal on the Study of Market Potential of Fast Food Restaurants in India

    782 Words  | 2 Pages

    It will provide entrepreneurs with a competitive edge that will prove invaluable in helping them seek the opportunity in this unexplored area of business. Through this research project one can study the opportunities and potential for Fast Food Restaurant Services in India. Since not too much of research is carried on in this area in India, there is a huge scope for this market and it could be useful for any budding entrepreneur who is interested in this industry.

    Read More

  • The Success of the McDonald’s Franchise

    1280 Words  | 3 Pages

    Not having to answer to a corporate boss is the dream of many and the flexibility that owning a business franchise creates provides this option. Success is not reached by simply creating a business, however. The level of success is measured by the size and efficiency of the business. Business growth is the driving force of the economy. The additional jobs and revenues created when a business expands allow the economy to grow at exponential rates. One of the fastest and most popular ways to increase the size of a business is to turn it into a franchise, which can then be purchased by individuals. Franchising provides opportunities that are beneficial to both the parent company and the purchaser. The company that owns the business can expand without having to pay such a large initial cost to open a new store since the franchise purchaser pays a cost to open the business. As well, the company can regulate many of the business activities so that there is a sense of consistency throughout all of the locations. The purchaser is allowed to use the trademarks and goods of the franchise which already have a large market presence. As well, they are provided with training and work standards by the company to help their business run smoothly (Kalnins & Lafontaine, 2004, p.761). Looking at the business model of the world’s largest food retailer, McDonald’s, provides great insight into franchising and business growth in general as well a better understanding of a global business that utilizes the franchising technique.

    Read More

  • Effects Of Lack Of Management In SME

    1542 Words  | 4 Pages

    Those SMEs which have more capable workers are likely to be more efficient (Hewitt and Wield, 1992; Lucas, 1993). Several studies recognized low human resource capabilities as major constraint in SMEs development in developing countries (Batra and Tan, 2003; Lee 2001; McElwee and Warren, 2000). Human resources in SME generally are weak in terms of their knowledge and skills of market analysis, marketing and product innovation as well as business planning and financial management. Therefore, the need is to develop capacity building programs to improve the entrepreneurial and business management skills of human resources in SMEs and enhance the effectiveness of SMEs. Entrepreneurial competencies may, therefore, be developed by training and education (Gibb, 1986; Romjin, 1989). Firms with a literate and well-educated workforce are thus likely to be more efficient because of their greater capability to absorb and effectively utilize new technology (Hewitt and Wield 1992; Lucas 1993). The creation and development of SMEs in Bujumbura, Burundi, will be affected with personal within

    Read More

  • Small Business Management

    1533 Words  | 4 Pages

    Throughout Europe, great attention has been paid to the small business area and to the contribution that entrepreneurial small businesses can bring beneficial to transforming the economy (EiM, 1994).The concept of entrepreneurship is often considered with new venture creation and small enterprise management, and the terms of owner-manager and self-employment (Gibb, 1996). While Kirby (2003) has argued that entrepreneurship is far broader than these concepts mentioned above. Not all owner-managers can be considered as entrepreneurs, nor are all small business entrepreneurial (Carland et al., 1984). Carland also has argued that entrepreneurial small business is aiming at profitability and growth, and the business is regarded to be innovative.

    Read More

  • Starting a Small Business

    2009 Words  | 5 Pages

    The first step in any business is to think of or create a business idea. Without an idea, one cannot launch their business off the ground. A right direction is needed to create a business with a unique idea. However, other options include franchising or buying an existing business (1). Franchising allows an individual to run stores such as Burger King or McDonalds under the corporate name. It involves taking training classes and a heap of money in order to start a franchise. A Franchisee will have to buy products and services from the corporate entity they are franchising from, which is often required. Buying a franchise is like taking a piece of the pie from the company that is franchising and sharing that pie with everybody else. In addition having a franchise allows one to communicate and in essence become a big part of an added business opportunity (4). Franchising is far from easy to start and maintain for that matter. Starting a franchise involves a l...

    Read More

  • Becoming Rich Essay: How To Become Rich?

    1076 Words  | 3 Pages

    A franchise is simply investing money in a location or store, and then having the store become your own business after learning how to manage the entire business. You earn the majority of the profits, and you also don't have to worry about operations. You'll be taught by the company on how it run the entire business, and this is the reason why this is a huge and very easy way to become rich. Franchises require quite a hefty investment depending on the business you plan to buy. However, if the business is in high demand, there is profits to be made. Take for exMple the Cold Stone Creamery business. Countless people purchase one of their many franchises. The money is very good, the opportunities are endless, and the fact that there is no more need for advertising is what makes this more worth the investment in the long

    Read More

More about Literature Review 'Business Viability: A Comparison Between Franchising'

Open Document