Chapter

4.5. Franchising: A Popular Trend*

From IntroductionToBusiness OP 8D04gAa

Concepts

1. What are joint ventures and why do companies form them?

   "In a joint venture, two or more companies form an alliance to pursue a specific project, usually for a specified time period. There are many reasons for joint ventures. The project may be too large f

2. Why is franchising a popular form of business organization?

   "When Shep Bostin decided to buy a franchise, he researched the usual suspects: Jiffy Lube, McDonald’s, and Quiznos Subs. Bostin, then 38, was a top executive at a dying Gaithersburg, Maryland, techno

3. How does a franchise agreement work?

   "Franchising is a form of business organization that involves a franchisor, the company supplying the product or service concept, and the franchisee, the individual or company selling the goods or ser

4. What are the advantages and disadvantages of franchising?

   "Like other forms of business organization, franchising offers some distinct advantages: Increased ability for franchisor to expand. Because franchisees finance their own units, franchisors can grow w