Describe the advantages and disadvantages of franchising fro

Describe the advantages and disadvantages of franchising from both franchiser and frannchisee perspecective.

Solution

owing a franchisee is a good option to the people who really interested for doing business but not having a good idea. for these kind of people franchisee is the best option. the benefits and disadvantages to the franchisee are as follows:

benefits: franchising offer important pre-opening service, they will provide on going support, they provide all kinds of inputs to run the unit in a succesfully way.

disadvantages: franchisee does not provide complete freedome of doing business, and it is not independent. we should follow the regulations, patterns, business guidelines from the franchiser. franchisees are required to operate their businesses according to the procedures and restrictions set forth by the franchisor in the franchisee agreement. these restrictions usually include the products or services which can be offered, pricing and geographic territory.

advantages to the franchiser:

by giving licence he will collect huge amounts of money. by appointing a franchisee he can cover the market in a broder way with less efforts. he can cover majority of the market.

disadvantages: if any franchisee makes any mistake, it leads to loss of goodwill and brand name in the market.