3.7,3.8 Franchises, Business Aims & Obj

The f__ sells rights to f__ to use their name, logo, etc for a f__
> reduces r__ of business

franchisor, franchisee, fee, risk

When a franchisor sells rights to a f__, they agree to provide services e.g.:
> Help with t__ staff & marketing
> Employing already t__ & tested business model, brand, product, service

franchisee, training, tried

The franchisee gives the f__:
o   Start up f__ covering initial c__ of marketing, training, setting up premises
% of revenue/p__

fee, cost, profit

Adv & Disadv to Franchisor

Adv	Disadv
Ø  Quick & c__ way to expand business Ø  Don’t need to borrow $$ from a b__ as franchisees pay you Ø  Get skills of other franchisees working to the benefit of your brand	Ø  You give a certain amt of c__ to someone else to build/ruin your reputation Ø  Franchisee benefits w/ profits of using your brand Ø  Franchisee may not have the same level of s__ in business that you have

cheap, bank, control, skill

Adv & Disadv to Franchisee

Adv	Disadv
Ø  Lower r__ way of starting business (tried & tested product) Ø  Predictable c__ (it’s been done before) Ø  Ongoing support from franchisor (has been successful before)	Ø  Have to pay a f__ to franchisor Ø  Have to pay % of revenue to franchisor >May have effect on franchisee profits Ø  Restricted in activity as you have to follow the franchisor’s way of running business

risk, cost, fee

Importance of Objectives
Ø  Makes business activity easier to u__

Ø  Successful businesses need appropriate strats built around the obj. = ensure business resources are used properly

Ø  Obj. are constantly reviewed

>>  Good & bad as reviews can disrupt what success is

>> But can lead to a change in objective if original is achieved

understand

Mission Statements
> Generic s__ of business’ core a__, phrased in a way to motivate workers & stimulate interest to those who don’t

statements, aims

Adv	Disadv
Ø  Quickly informs ppl abt f__ Ø  Can be motivating Ø  Helps guide worker’s behaviour	Ø  Often too v__ Ø  Can be seen as a PR exercise (to get publicity) Ø  Impossible to agree or disagree

Business aims

firm, vague

Objectives of firms:
> s__: short term for new firms (their primary obj.)

> profit m__: earning as much r__ as possible while cutting as much c__ as possible

> profit s__: earning just e__ profit to s__ owner’s needs

survival, maximisation, revenue, costs, satisficing, enough, satisfy

Objectives of firms:
> g__: measured by sales & output

> market s__: ↑customer loyalty, ↑brand image (as you’re dominant)

> C__: environmental, social ethics

growth, share, csr

Determinants of Objectives

1.      Corporate c__: way stuff is done; every business is diff.

2.      Legal s__ of business: sole trader = profit satisficing; Ltd = growth; PLC = ↑market share

3.      Public vs p__ sector: diff. motives; public’s measurement = service provided & nor $$

4. # of y__ in business: new business = survival; existing = growth

culture, structure, private, years