An entrepreneur who started a chain of auto service centers to do fast oil chang
ID: 442725 • Letter: A
Question
An entrepreneur who started a chain of auto service centers to do fast oil changes wants to quickly expand by building new facilities in new markets but does not have enough capital. His financial advisor suggested that he might be able to get around the financial constraint and still grow rapidly if he franchised his idea. That way the franchisees would invest to build their own centers, but fees from the franchise agreement would also provide cash flow to build more company-owned outlets. Do you think this is a good idea? Why or why not?
Explanation / Answer
Yes, this is a good idea because franchising a business is a confirm way to fast growth.But taking a franchisor memebership is not so much easy job especially in this require economy.Becoming a successful new franchisor encompass making many thoughtful decisions early on that way affect your business.There is so much legal paperwork involve in it and also involve fee for taking a franchisor.While taking franchise there are some steps involve in it like.
1.make and acknowledge your concept,
2.check your financial status which means either you can afford its fees or not,
3.pay attention while processing legal paperwork etc.