Evaluate franchising as a form of business organisation for the franchisee.


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	Advantages well-known brand - buying into already established profitable format defined territory - guarantee no other franchisees operating within the brand will compete within given geographical area training + support - franchisee receives assistance from the franchisor (product development, advertising, promotion + extensive training of any support for management + employees) access to finance - banks consider well-known franchises as low risk (willing to loan for investment + growth purposes)	Disadvantages fees to franchisor - franchisee has to pay up-front fee + must pay an agreed % of profits to franchisor annually loss of control - franchisor has major say in running of business + franchisee receives strict guidelines (deviation is not tolerated) interdependency - negative actions of other franchisees operating within the same brand can have adverse effect on profits of all other franchisees
	Evaluation A franchisee's legal structure can be sole trader, partnership or limited company. e.g McDonalds, Pizza Hut, Kia Motors, Subway, Starbucks

well-known brand - buying into already established profitable format
defined territory - guarantee no other franchisees operating within the brand will compete within given geographical area
training + support - franchisee receives assistance from the franchisor (product development, advertising, promotion + extensive training of any support for management + employees)
access to finance - banks consider well-known franchises as low risk (willing to loan for investment + growth purposes)

fees to franchisor - franchisee has to pay up-front fee + must pay an agreed % of profits to franchisor annually
loss of control - franchisor has major say in running of business + franchisee receives strict guidelines (deviation is not tolerated)
interdependency - negative actions of other franchisees operating within the same brand can have adverse effect on profits of all other franchisees

A franchisee's legal structure can be sole trader, partnership or limited company. e.g McDonalds, Pizza Hut, Kia Motors, Subway, Starbucks

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