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Franchises Confused

rs89

Posted 12 May 2007 - 06:16 PM

Can anyone give me a good example of one and explain what is the franchiser and the franchisee?

It confuses me.

Ive heard McDonalds but i dont get the whole putting it under the name thing huh.gif

lozygirl

Posted 12 May 2007 - 08:43 PM

hiya

well franchise is a business run by one firm under the name of another so:

Franchiser gives the franchisee a license permitting them to sell goods or services under their companys bramd name usually in return for a share of the franchisee's profits .

Mcdonalds is a franchise. As they are run by many people and is a global brand.

Sorry its hard to explain but just make sure you know the advantages and disadvantages for the franchiser and the franchisee. And remember its definition.

And once again sorry i dont know if its helped.

ermd

Posted 12 May 2007 - 11:11 PM

Another example would be Subway - none of Subway's UK outlets are owned by the Subway company, they are all owned by private individuals/groups. Subway sells them a license to use the Subway name and products in return for a share of the profits.

Discogirl17

Posted 15 May 2007 - 10:13 AM

Franchiser- gives the franchisee a license permitting them to sell goods or services under their companys brand name
Franchisee- Give the franchiser a share of profits in return for use of the brand name

MacDonalds and Subway are indeed the best examples. MacDonalds is a franchise chain since the HQ in America acts as franchiser and each store is owned individually by local owners (or franchisees). In order to standardise quality, MacDonalds provides tools not just premises. This is how each store sells the same things.


Advantages for Franchiser

* more new ideas can be generated- e.g. Egg McMuffin thought up by franchisee then relayed to all other stores
* stores can be spread across more locations


Disadvantages for Franchiser

* if one franchisee stuffs up, the reputation of all is damaged

Advantages for Franchisee

* brand already etsablished
*given help in running business

Disadvantages for Franchisee

* Less Freedom


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