In a franchise, legal binding agreement is entered into between two firms, the franchisor (the product or service owner) and the franchisee (the firm to market the product or service in a particular location). To summarise the review of the franchising literature, a number of gaps have been highlighted in the franchising research. The loyalty of a customer contributes to the success of the brand. Thesis About Franchising | Best Writing Service A franchise usually poses small startup expenses for entrepreneurs as well as absorbing much of the risks and uncertainties associated with starting a hotel business. This follows the lack of modern and informative management experiences. The type of Sidhpuria asserts that the flexibility of the franchising system should allow the franchisors to tailor all their [], As a result, the success of an entrepreneurship often hinges on the type of the business chosen, i.e, the set of liabilities that the organisation accepts, the structure, in accordance with which the company is [], Included in the Peak by Four Seasons franchise investment are: Beverage services Culinary equipment/Furniture Personal effects such as towels, dishes, and toiletry Marketing the Peak by Four Seasons by these hotels The Peak by Four []. Studios used by XPOF are typically modest in size and design, and are financed through equipment leases rather than traditional loans. Subsequently, franchising is experiencing a challenge arising from the franchisors demand to comply with the concept [], The success of franchising is subject to the nature of relationship established between the franchisor and the franchisee. Thesis update This is an update to my original Xponential Fitness ( NYSE: XPOF) thesis. It is not simply an ability to grow which creates a successful Franchise and nor is it the desire of any franchisor to adopt every potential franchisee. The steady increase in new franchise licenses issued shows that interest in XPOF's franchise opportunity remains high. stream % Franchise Lastly, the law obliges all franchisors to offer franchisees with all possible operational information. Site selection location of the premises 13 7.3. Good Research Topics about Franchising Franchising, Ownership, and Experience: A Study of Pizza Restaurant Survival Small Business Franchising [ 11 0 R] The impressive KPI performance, including robust store comparable sales growth and significant increases in membership and studio visits, further solidifies my confidence in XPOF's expansion trajectory. Presently, mid-market franchises have been revealing their best in ensuring that their brand promises are delivered to their customers and potential affiliations. Manufacturing and Wholesale - In this type of franchise a franchiser grants a manufacturer the right to produce and sell goods using its name. For instance, Accor has tried to acquire a stronghold in the Chinese market with Grand Mercure regionally known as Mei Jue. Franchising and decision variables The article in Franchising versus company-run operations: Modal choice in the global hotel sector discusses the various Some advantages are bargaining power with suppliers and a high success rate. The Impact of Franchising Another impressive feat is that membership in NA grew 31% to 665K with studio visits up 38% y/y, which I think is a big surprise to many investors as consumer sentiment was supposed to be weak (and hence less discretionary spend). In a franchise research and development of products is facilitated by the wide pool of staff across the chains and close proximity to the consumer. January 21, 2023. https://ivypanda.com/essays/topic/franchising-essay-topics/. Open Document. Franchise vs Business Opportunity: Whats the Difference? Franchises also have large-volume, centralized buying power. As a shopper, the independent hotelier seeks the maximum value for his intended affiliations. <> Metrics and citations. Mainland China swarms with entrepreneurs that are more than willing to invest in franchised hotels. Franchise owners should know that the success of a franchisor does not automatically make their business success because they will have to manage their entities well. One of the fastest and most popular ways to increase the size of a business is to turn it into a franchise, which can then be purchased by individuals. The daily operations at the company headquarters followed a routine of a short meeting between the CEO, Brian Scudamore, and staff which are centered on discussions about important daily data and keynote addresses from the []. During the first three months of the year, XPOF was able to sell 188 franchise licenses, bringing the grand total of licenses sold to 5,638. Franchisors do not like to take on entrepreneurs as franchisees. Franchising in the Czech Republic 9 6. | | b. Lansing, Kansas. research-repository.griffith.edu.au <> Under the concept of standardisation, the franchisee is required to adhere to the operational parameters set by the franchisor. endobj This is the increase in the volume of the final product relative to the ice-cream mix, following the process of incorporating air into the mix. The franchising royalty fees and other expenses, inclusive of the general system reservation, required prior to franchising can prove steep. If management raise guidance in August, I think it is a strong catalyst for the share price as management would already have 8+months of data. They needed to talk to the representatives of the Second Cup to obtain a more detailed breakdown of the expenses and projected earnings. Franchisee is the one who consumes trademark of the supplier and deliver the supplier's goods. The word "franchising" comes from the old French term defining the right for freedom of conducting any activity, for example, carrying out fairs, the organization of markets, operation of ferries and crossings, the right for hunting, a construction, Advantages & Disadvantages of Franchising Licences and laws 13 7.2. I believe XPOF will be able to hit this target due to its growth model. Secondly, on-going marketing of your business is backed by the power of the established brand, and could be as simple as contributing a fee to a advertising fund that is driven by the franchisor. Entrepreneurs, therefore, choose those franchises that notable for investing more in their rooms thus coming up with a competitive strategy that is cost effective. Therefore, the weighted average cost of capital is the expression of the market value of a source of finance with respect to its contribution to the total capital base of a business. However, almost a handful of them have proven competent enough to manage them. consideration. WebFranchising, as a business format for market penetration, has become an accepted strategy for business growth, job creation and economic development. Typically, a company also requires the owner to purchase supplies from the company. The Pros And Cons Of Buying A Franchise - Forbes Franchising is defined as a commercial agreement between a party that owns a trade name or trademark (the franchisor) and party that sells or distributes goods or services using that trade name or trademark (the franchisee) (Kubasek et al., 2015, p. 431). Franchise A franchise is a legal agreement between franchisers and franchisees that consents use of the franchises trademark and trade name or marketing plan. I am not receiving compensation for it (other than from Seeking Alpha). I now expect XPOF to achieve $410 million in revenue in FY25 as the business continues to show momentum. Xponential Fitness (XPOF): Growth Continues To Be Strong, This is a chain founded by Chinese business mogul Ji Qi almost a decade ago. It is also prudent to mention that both the capital and earnings can be boosted at the same time due to the available opportunities. Some advantages are bargaining power with suppliers and a high success rate. Membership and unit growth were both solid, and comparable sales growth exceeded expectations in 1Q23, making it another successful quarter for the company. When performing their cost-benefit analyses, it is vital to consider the number of new consumers a given affiliation can attract. to another business, the franchisee. A franchise is usually ran by a someone who is already extremely wealthy,An advantage to a franchise is seeking success at a lower failure rate. (Franchise.org, 2016). Many people find franchises carry less risk than the average small business and that it requires far less of their attention (Meaney, 2004). This dimension is important in a way that it reveals that long-term reliability of the business deal under binding. Additionally, the country enjoys playing the worlds largest host of the franchise industry with over 200,000 franchised retail outlets belonging to almost 2600 international brands (Chao, 2008). It is, therefore, vital that hoteliers consider additional dimensions such as location and the target market. Franchising Essay Examples | Kibin Costs In exchange for the right to use the franchisors name and assistance, you will pay some or all of the following fees. The third section presents the result of the analysis and the final sections identifies redesign consideration that the cafe needs to make. If franchises can't find and secure sites for new studios, it will have a big effect on the rate of revenue growth. I have faith that the XPOF franchisee system will continue to be robust and capable of adapting to changing market conditions. All the aspects of this business activity will be represented from the point of view of the successful business strategy and all the required details for the marketing activity. We cast here once. The current Chinese economic success has led to the rise of a fast growing middle class with the hankering of vast domestic travel. Similarly, legal documents associated with franchising and licensing often shields the affected franchisor from court battles. I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. As logic would have it, this dimension exposes the franchises need to work out an informative consumer need diagnostic technique (Qui, 2004). This shows the governments protection of domestic franchisors at the expense of their foreign counterparts. Thesis Importantly, comparing these two metrics reveals that growth was driven primarily by volume, with pricing serving as a complementary factor. Franchising is a solid foundation of hotel industry. The essence of franchising as a special form of business organizational structure 1.1 The history of franchising To begin with, the concept of franchising originally appeared in Britain in the 10th century and as a term described a variety of benefits, which were provided to the citizens in the context of the electoral process. The franchisor will teach you everything you need to know. A literature review of franchisee performance: Insights for further 97 Franchising Essay Topic Ideas & Examples - IvyPanda Franchises also offer the familiarity that mass advertising of big brands accomplishes. The Hantings Inns boss expects his business empire to have become the worlds biggest hotel franchise by the year 2020. In such strategic times, mid-market hoteliers usually discuss the key characteristics of effective customer service and activities that exceed their customers expectations (Okoroafo, Koh, & Liu, 2010). The financial plan is the basic component of the business plan as it provides the feasibility of a project and enables the investors to make logical decisions regarding the acceptance and rejection of the project []. In contrast to larger franchise networks like Planet Fitness, XPOF is owned and operated by many small businesses. This model can be used to describe a number of business models, such as McDonalds, KFC, etc. Research Paper Sample on Franchising | HowToWrite by Thesis WebThe thesis will provide information about the actual busi- ness plan, theoretical and practical investigation on how franchising would efficiently work in the Finnish market, basic This provision covers all domestic and foreign franchisors/franchisees intending to do business in China. However, the revival of franchising as a modern business institution is marked by the year 1840, the year of the appearance of the first worldwide franchise network (the system of tied pubs) in the UK, which was used by the brewers in order to maintain the necessary volume of sales. It seems encouraging enough that individual hoteliers look for helpful franchises with excellent work ethics (Su, 2006). Family of Houston woman who died in Arby's freezer files lawsuit The main aim of the company is to expand globally and provide the lowest cost product to its customer. WebThese essays provide insights into the benefits and risks of franchising as a business model, its legal and contractual frameworks, as well as strategies for success. Therefore, unlike larger operators, XPOF is less vulnerable to difficulties caused by rising interest rates. Retrieved from https://ivypanda.com/essays/topic/franchising-essay-topics/. Being a landlord is indeed more profitable and an easier business to manage than selling burgers and fries. Therefore, dire consideration of the above dimension and effective due diligence would assist in forging a solid business relationship (Zhang & Pine, 2005). Definition of franchising 7 4. In franchising, franchisors not only specify the products and services that will be offered by the franchisees, but also provide them with an operating system, brand and support. However, it has been very common for new laws to be implemented without amending the existing regulations dealing with the similar areas.

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