Chapter 6

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Chapter 6

  1. 1. <ul><li>CHAPTER 6 </li></ul><ul><li>DEFINE & EXPLAIN WHAT FRANCHISING IS. </li></ul><ul><li>EXPLAIN THE 3 MAIN TYPES OF FRANCHISING. </li></ul><ul><li>WHAT ARE SOME ADVANTAGES TO FRANCHISING? </li></ul><ul><li>WHAT ARE SOME DRAWBACKS TO BUYING A FRANCHISE? </li></ul>
  2. 2. FRANCHISING -”SEMI-INDEPENDENT BUSINESS OWNERS (FRANCHISEES) PAY FEES & ROYALTIES TO A PARENT COMPANY (FRANCHISER) IN RETURN FOR THE RIGHT TO BECOME IDENTIFIED WITH ITS TRADEMARK, TO SELL ITS PRODUCTS OR SERVICES, & OFTEN TO USE ITS BUSINESS FORMAT & SYSTEM.”
  3. 3. TYPES OF FRANCHISING
  4. 4. 1) TRADE NAME FRANCHISING -THE FRANCHISEE PURCHASES THE RIGHT TO USE THE FRANCHISER’S TRADE NAME WITHOUT DISTRIBUTING PARTICULAR PRODUCTS EXCLUSIVELY UNDER THE FRANCHISER’S NAME.
  5. 5. 2) PRODUCT DISTRIBUTION FRANCHISING -A FRANCHISER LICENSES A FRANCHISEE TO SELL ITS PRODUCTS UNDER THE FRANCHISER’S BRAND NAME & TRADEMARK THROUGH A SELECTIVE, LIMITED DISTRIBUTION NETWORK.
  6. 6. 3) PURE FRANCHISING -A FRANCHISER SELLS A FRANCHISEE A COMPLETE BUSINESS FORMAT & SYSTEM.
  7. 7. BENEFITS OF BUYING A FRANCHISE
  8. 8. 1) MANAGEMENT TRAINING & SUPPORT
  9. 9. 2) BRAND NAME APPEAL
  10. 10. 3) NATIONAL ADVERTISING PROGRAMS
  11. 11. DRAWBACKS OF BUYING A FRANCHISE
  12. 12. 1) FRANCHISE FEES & ONGOING ROYALTIES
  13. 13. 2) MARKET SATURATION
  14. 14. 3) LESS FREEDOM

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