Successfully reported this slideshow.
We use your LinkedIn profile and activity data to personalize ads and to show you more relevant ads. You can change your ad preferences anytime.

Franchising (by Matt and Suh-Hee)

5,813 views

Published on

This is the presentation file that Matt Mosley and Suh-hee Choi designed for the HTM681 (advanced hotel management) presentation at Purdue University (West Lafayette, IN, USA)

Published in: Business
  • Unlock Her Legs - How to Turn a Girl On In 10 Minutes or Less... ♣♣♣ http://t.cn/AiurDrZp
       Reply 
    Are you sure you want to  Yes  No
    Your message goes here
  • DOWNLOAD THAT BOOKS INTO AVAILABLE FORMAT (2019 Update) ......................................................................................................................... ......................................................................................................................... Download Full PDF EBOOK here { http://bit.ly/2m6jJ5M } ......................................................................................................................... Download Full EPUB Ebook here { http://bit.ly/2m6jJ5M } ......................................................................................................................... Download Full doc Ebook here { http://bit.ly/2m6jJ5M } ......................................................................................................................... Download PDF EBOOK here { http://bit.ly/2m6jJ5M } ......................................................................................................................... Download EPUB Ebook here { http://bit.ly/2m6jJ5M } ......................................................................................................................... Download doc Ebook here { http://bit.ly/2m6jJ5M } ......................................................................................................................... ......................................................................................................................... ................................................................................................................................... eBook is an electronic version of a traditional print book that can be read by using a personal computer or by using an eBook reader. (An eBook reader can be a software application for use on a computer such as Microsoft's free Reader application, or a book-sized computer that is used solely as a reading device such as Nuvomedia's Rocket eBook.) Users can purchase an eBook on diskette or CD, but the most popular method of getting an eBook is to purchase a downloadable file of the eBook (or other reading material) from a Web site (such as Barnes and Noble) to be read from the user's computer or reading device. Generally, an eBook can be downloaded in five minutes or less ......................................................................................................................... .............. Browse by Genre Available eBooks .............................................................................................................................. Art, Biography, Business, Chick Lit, Children's, Christian, Classics, Comics, Contemporary, Cookbooks, Manga, Memoir, Music, Mystery, Non Fiction, Paranormal, Philosophy, Poetry, Psychology, Religion, Romance, Science, Science Fiction, Self Help, Suspense, Spirituality, Sports, Thriller, Travel, Young Adult, Crime, Ebooks, Fantasy, Fiction, Graphic Novels, Historical Fiction, History, Horror, Humor And Comedy, ......................................................................................................................... ......................................................................................................................... .....BEST SELLER FOR EBOOK RECOMMEND............................................................. ......................................................................................................................... Blowout: Corrupted Democracy, Rogue State Russia, and the Richest, Most Destructive Industry on Earth,-- The Ride of a Lifetime: Lessons Learned from 15 Years as CEO of the Walt Disney Company,-- Call Sign Chaos: Learning to Lead,-- StrengthsFinder 2.0,-- Stillness Is the Key,-- She Said: Breaking the Sexual Harassment Story That Helped Ignite a Movement,-- Atomic Habits: An Easy & Proven Way to Build Good Habits & Break Bad Ones,-- Everything Is Figureoutable,-- What It Takes: Lessons in the Pursuit of Excellence,-- Rich Dad Poor Dad: What the Rich Teach Their Kids About Money That the Poor and Middle Class Do Not!,-- The Total Money Makeover: Classic Edition: A Proven Plan for Financial Fitness,-- Shut Up and Listen!: Hard Business Truths that Will Help You Succeed, ......................................................................................................................... .........................................................................................................................
       Reply 
    Are you sure you want to  Yes  No
    Your message goes here
  • Stop getting scammed by online, programs that don't even work!  http://scamcb.com/ezpayjobs/pdf
       Reply 
    Are you sure you want to  Yes  No
    Your message goes here
  • DOWNLOAD FULL eBOOK INTO AVAILABLE FORMAT ......................................................................................................................... ......................................................................................................................... 1.DOWNLOAD FULL. PDF eBook here { https://tinyurl.com/y3nhqquc } ......................................................................................................................... 1.DOWNLOAD FULL. EPUB eBook here { https://tinyurl.com/y3nhqquc } ......................................................................................................................... 1.DOWNLOAD FULL. doc eBook here { https://tinyurl.com/y3nhqquc } ......................................................................................................................... 1.DOWNLOAD FULL. PDF eBook here { https://tinyurl.com/y3nhqquc } ......................................................................................................................... 1.DOWNLOAD FULL. EPUB eBook here { https://tinyurl.com/y3nhqquc } ......................................................................................................................... 1.DOWNLOAD FULL. doc eBook here { https://tinyurl.com/y3nhqquc } ......................................................................................................................... ......................................................................................................................... ......................................................................................................................... .............. Browse by Genre Available eBooks ......................................................................................................................... Art, Biography, Business, Chick Lit, Children's, Christian, Classics, Comics, Contemporary, CookeBOOK Crime, eeBOOK Fantasy, Fiction, Graphic Novels, Historical Fiction, History, Horror, Humor And Comedy, Manga, Memoir, Music, Mystery, Non Fiction, Paranormal, Philosophy, Poetry, Psychology, Religion, Romance, Science, Science Fiction, Self Help, Suspense, Spirituality, Sports, Thriller, Travel, Young Adult,
       Reply 
    Are you sure you want to  Yes  No
    Your message goes here
  • I am giving you a best business opportunity. If you have simple online knowledge and english you shall earn good money. Just visit sgbc.in and other of our site www.bizbilla.com and www.svasamsoft.com

    Just post your details in the below link. I will do explain you further about this new generation business and you shall earn in lakhs if you work with this properly.

    http://www.sgbc.in/agent.php?q=agent
    http://www.sgbc.in/agent.php?q=regional
    My Best Regards
    Sincerely yours
    Dr.K.Karthikeyan
    Tamilnadu
    India
    Mob:04565-230755
    9486002333
       Reply 
    Are you sure you want to  Yes  No
    Your message goes here

Franchising (by Matt and Suh-Hee)

  1. 1. January 20, 2009 Matt Mosley Suh-hee Choi Franchising HTM 681 First Topic Department of Hospitality and Tourism Management Purdue University
  2. 2. Franchise—Definition <ul><ul><li>A method of distribution </li></ul></ul><ul><ul><li>A type of strategic alliance </li></ul></ul><ul><ul><li>Agents involved in a franchise system </li></ul></ul><ul><ul><ul><li>The franchisor -- lends his trademark or trade name and a business system </li></ul></ul></ul><ul><ul><ul><li>The franchisee -- pays a royalty (+ an initial fee) for the right to do business under the franchisor's name and system </li></ul></ul></ul><ul><ul><ul><li>the contract (technical meaning) </li></ul></ul></ul><ul><ul><ul><li>the business that franchise operates (actual meaning) </li></ul></ul></ul>http://www.franchise.org/faq.aspx
  3. 3. Franchise—Definition <ul><li>(from the Code of Federal Regulations) </li></ul><ul><li>Any continuing commercial relationship or arrangement in which the terms of the offer or contract specify, or the franchise seller promises or represents that: </li></ul><ul><li>The franchisee will obtain the right to operate a business that is identified or associated with the franchisor's trademark , or to offer, sell, or distribute goods, services, or commodities that are identified or associated with the franchisor's trademark; </li></ul><ul><li>The franchisor will exert a significant degree of control over the franchisee's method of operation, or provide significant assistance in the franchisee's method of operation; and </li></ul><ul><li>(3) As a condition of obtaining or commencing operation of the franchise, the franchisee makes a required payment to the franchisor or its affiliate. </li></ul>
  4. 4. http://www.franchise.org/uploadedFiles/Franchise_Industry/Resources/Education_Foundation/FW%20Dec07%20p42-44.pdf
  5. 5. Benefits Barbara Beshel, 2001, An Introduction to Franchising, IFA Educational Foundation
  6. 6. Disadvantages <ul><li>Restrictions (product, pricing, site) </li></ul><ul><li>Ongoing royalties and advertising fees. </li></ul><ul><li>Bad reputation caused by </li></ul><ul><ul><li>poor performance of other franchisees </li></ul></ul><ul><ul><li>unforeseen problems of the franchisor </li></ul></ul><ul><ul><li>free-riders </li></ul></ul><ul><li>Limited duration of a franchise agreement </li></ul>Barbara Beshel, 2001, An Introduction to Franchising, IFA Educational Foundation
  7. 7. Franchise Industries
  8. 8. Types of franchising <ul><li>Single-unit franchise </li></ul><ul><li>Multi-unit franchise </li></ul><ul><ul><li>An area development franchise </li></ul></ul><ul><ul><li>A master franchise </li></ul></ul>
  9. 9. Theories <ul><li>Resource Scarcity </li></ul><ul><ul><li>Financial + Intellectual </li></ul></ul><ul><ul><li>Limitations: growth and survival doesn’t guarantee profitability. </li></ul></ul><ul><li>Agency Theory </li></ul><ul><ul><li>Less monitoring costs </li></ul></ul><ul><ul><li>Assumption: economic, rational actors, homogeneity of perception / action </li></ul></ul><ul><ul><li>Costs of local monitoring Vs. Risks of free-riding </li></ul></ul><ul><ul><li>Moral hazard issues </li></ul></ul>Combs, Michael, & Castrogiovanni, 2004 Agency Theory : Lafontaine, 1992
  10. 10. Theories (suggested by Combs et al., 2004) <ul><li>Upper echelons theory </li></ul><ul><ul><li>Emphasizes managers’ characteristics (previous experiences, age, etc.) </li></ul></ul><ul><li>Resource-based theory </li></ul><ul><ul><li>Points out biased distribution / trade of resources </li></ul></ul><ul><ul><li>Increase of conflict management capabilities  Increase of competitive advantages  Increase of franchising </li></ul></ul><ul><li>Institutional theory </li></ul><ul><ul><li>Articulates the importance of social, environmental, institutional, legal factors </li></ul></ul><ul><ul><li>Organizational behavior (propensity for predictability / stability) </li></ul></ul>
  11. 11. Previous Research Control system What Motivates Franchising? • Comparing franchised / independent restaurants • Resource Scarcity ( The effect of resource scarcity on the proportion of franchised outlets) Which industries are more franchised? Which regions are more franchised? Moral issues
  12. 12. Previous Research (cont.) <ul><li>From the franchisors’ perspectives </li></ul><ul><ul><li>geographic expansion </li></ul></ul><ul><ul><li>intellectual scarcity (Oxenfeldt and Kelly, 1969) </li></ul></ul><ul><ul><li>financial scarcity (Oxenfeldt and Kelly, 1969) </li></ul></ul><ul><ul><li>economies of scale (Oxenfeldt and Kelly, 1969) </li></ul></ul><ul><ul><li>innovation (Bradach, 1997) </li></ul></ul><ul><ul><li>survival and growth (Bates, 1995) </li></ul></ul>What Motivates Franchising? (Benefits of Franchising)
  13. 13. Previous Research (cont.) <ul><li>Consumers’ perception </li></ul><ul><ul><li>Higher degrees of satisfaction (Young et al., 2008 – restaurant) </li></ul></ul><ul><ul><li>Brand recognition </li></ul></ul>What Motivates Franchising? (Benefits of Franchising)
  14. 14. <ul><li>Site selection (Park & Khan, 2005) </li></ul><ul><li>Fast Food and Restaurants (IFA, 2006) </li></ul>Previous Research (cont.) Which industries are more franchised? Which regions are more franchised?
  15. 15. <ul><li>e.g. Agency Theory perspectives </li></ul><ul><ul><li>Vertical problems – appropriating royalties, not adhering to standards, etc. </li></ul></ul><ul><ul><li>Horizontal problems – free ride </li></ul></ul><ul><li>Control Systems (Vazquez, 2008) </li></ul><ul><ul><li>Geographic issues (e.g. International franchising) </li></ul></ul><ul><ul><li>Standardization Vs. Adaptation </li></ul></ul>Previous Research (cont.) Moral issues & Control systems
  16. 16. <ul><li>Does franchising really work? </li></ul><ul><li>What types of franchise perform well? </li></ul><ul><ul><li>Financial </li></ul></ul><ul><ul><ul><li>Optimal franchise fee, royalty rate </li></ul></ul></ul><ul><ul><li>Optimal franchising outlet % (e.g. Hsu & Jang, In Press) </li></ul></ul>Previous Research (cont.)

×