Characteristics of Franchising Systems

Characteristics of Franchising SystemsDEFINITION OF FRANCHISINGFranchising is a viable method of distributing goods and services which end have a positive influence on economic tuition by its contribution to the establishment of new businesses and job creation. (By Martin Mendelsohn,2004, p.1,The Guide to Franchising).The diffusion networks can be expanded without having to borrow funds or lift additional equity finance. Some crownwork will be indispensable to prepare for franchising but in general the claimes will supply the capital as they will fund their own outlets. (By Gideon Nieman, 1998,p.8,)One can stick out in business with the use of comprehensive business package consisting of an conventional trade name and corporate image, a proven product or service, and the benefit of the goodwill that has been built up up by the franchisor. (By Gideon Nieman,1998, p.9,the license option-how to franchise your business).Disadvantages for franchisees Loss of independence one of t he most serious disadvantages of befitting a franchisee is loss of independence. If you want to make all your own decisions, franchising whitethorn be the wrong choice. Franchise carcasss are structured in such(prenominal) a way that the franchisor sets many of the rules the franchisee is required to operate the business match to the franchisors manuals and procedures.Over-dependence on the dodge loss of independence , if taken to extremes, leads to a promote disadvantage over dependence on the franchise agreement. When franchisees rely all in all on the system for their success, their over-dependence can cause problems. Franchisees have to balance system restrictions with their personal ability to manage their own businesses. For example, when a franchisee depends on field advertising exclusively and does not invest in local trade , she is short changing her business by relying too greatly on what the franchisor is bringing to the party. (By Michael Seid, Dave Thomas, 2007, p.42, Franchising for dummiesCommon characteristics of franchise systems that reflect different types of exploration and ontogenesisThe positioning of the system in the marketThe degree of hardness of the systemThe systems entrepreneurial orientationThe room for strategic participation of franchisees in the systemThe systems growth objectives ( by Josef Windsperger, Grard Cliquet, George Hendrikse, Mika Tuunanen, 2012, P.194, economic and management of franchising networks).Several limitations of franchise relationships as a specific form of alliance in which both franchisor and franchisee are intelligent partners that interact and adjust to each other by means of time. The franchise relationship is often seen as a static, top flock relationship in which the focus is on efficiency-aspects, such as supervise and control of franchisees. However, it is argued here franchise systems and the relationships within them have to deal with enigma of exploitation and exploration in organis ational adaptation. Exploitation includes aspects such as refinement, choice, production, efficiency, selection, carrying out and execution. Exploration includes issues such as search, variation, risk-taking,experimentation, play,flexibility, discovery and innovation. Arguably, firms must try to think an appropriate balance betyween exploitation and exploration in order to live and prosper in their environment. ( by Josef Windsperger, Grard Cliquet, George Hendrikse, Mika Tuunanen, 2012, P.194).Resource acquisition speculationhttp//www.whichfranchise.com/resources.cfmhttps//books.google.co.uk/books?id=9bXdna3dpEkCpg=PA61lpg=PA61dq=Brand+the+franchise+benefits+from+operating+under+the+name+and+reputation+ betray+(image)+of+the+franchisor,+which+is+already+well+established+in+the+mind+eye+of+the+public.source=blots=8S9g1KfYUFsig=i6g2copZdN7dITp0uFMxSdx1MRQhl=ensa=Xved=0ahUKEwjMnvPap9TJAhUGVRQKHXq2BbwQ6AEIJjAAv=onepageq=Brand%20the%20franchise%20benefits%20from%20operating%20under% 20the%20name%20and%20reputation%20brand%20(image)%20of%20the%20franchisor%2C%20which%20is%20already%20well%20established%20in%20the%20mind%20eye%20of%20the%20public.f=falsehttp//search.proquest.com/abiglobal/docview/220131590/63A3C6E4CB69411CPQ/1?accountid=10472http//www.referenceforbusiness.com/small/Eq-Inc/Franchising.htmlhttp//emarket.franchise.org/FRCSupportHandbook.pdfhttp//www.emeraldinsight.com/doi/full/10.1108/08876040710818895http//www.entrepreneur.com/ resolving/227691http//www.franchising.com/guides/what_is_franchising_the_basics.htmlhttp//www.emeraldinsight.com/doi/abs/10.1108/08876040710818895http//www.whichfranchise.com/resources.cfmhttp//www.theukfranchisedirectory.net/page/history-of-franchising.phphttp//www.franchising.com/articles/what_is_franchising.html