...agreement, as in "we have the Taco Bell franchise in our town." 5) adj. referring to a "franchise tax" which is placed on businesses (especially corporations) for the right to conduct business, as distinguished from a tax on property, income or profits tax. Source: http://legal-dictionary.thefreedictionary.com/Franchise+system According to Steven C. Michael Franchising, in which independent businesses operate under a shared trademark using a common production process, is used primarily by service businesses. It is an enduring and pervasive organisational form. As an organisational form, franchising has a large and visible presence in consumer industries such as restaurants, lodging, auto repair, real estate, hair styling, and specialty retailing, where it has captured typically thirty to forty percent of sales. Business services in which franchising is prominent include temporary employment, commercial cleaning, printing and copying, tax preparation, and accounting services. Recent areas of growth include home health care, business signage, and child development and education. Historically, franchising was introduced in the United States in the early 20th century by manufacturers in order to secure local distribution of their product (Dicke 1992). Franchise...
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...An Introduction to Franchising Franchising * Franchising is a form of business organization in which a firm that already has a SUCCESSFUL product or service (FRANCHISOR) licenses its trademark and method of doing business to another business or individual (FRANCHISEE), in exchange for a franchise fee and ongoing royalty payment * International Franchise Association (IFA): “A franchise operation is a contractual relationship between the franchisor and franchisee in which the franchisor offers or is obliged to maintain a continuing interest in the business of the franchisee in such areas as know-how and training; wherein the franchisee operates under a common trade name, format and/or procedure owned or controlled by the franchisor, and in which the franchisee has or will make a substantial capital investment in his business from his own resources.” * Franchising is MORE than just distributorship because it extends to an ENTIRE operation or method of dong business, involves greater assistance, control and longer duration, whereas the distributor merely re-sells products to retailers or customers Growth of Franchising The word “franchise” comes from an old dialect of French and means privilege or freedom Singer Sewing Machine - first franchise (mid 19th century) Automobile - Ford, Petroleum Products - Shell, Softdrinks - Coca Cola, Food & Restaurants - McDonalds & Starbucks Home markets became saturated, resulting in attractive opportunities overseas...
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... |Servpro |$138.55K − 187.19K | |8 |Denny’s Inc. |$1.32M − 2.61M | |9 |Pizza Hut Inc. |$297K − 2.1M | |10 |Dunkin’ Donuts |$216.1K − 1.52M | Source: http://www.entrepreneur.com/franchise500/index.html [pic]About Anytime Fitness Anytime Fitness clubs are open 24 hours a day every day of the year, thanks to security systems that allow members to access the clubs during unstaffed hours. The company, which began franchising in 2002, is expanding worldwide. [pic] Franchise Units |YEAR |U.S....
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...................................................................................................................... 8 2.2 Identity or Branding .................................................................................................................................... 8 2.3 Expansion or Growth ................................................................................................................................... 8 3.0 Setting Up The Business ............................................................................................................. 9 4.0 Market Entry .............................................................................................................................. 9 5.0 Opportunity or Franchising ..................................................................................................... 11 6.0 Changes In Business Enviroment...
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...Donuts has tremendously jacked up its growth and awareness, which served as the foundation for its brand leadership and popularity. The tremendous growth, marked by increasing sales every year, can be attributed to its quality products and the conscientious implementation of standards that come with them. Sustaining Brand Leadership and Popularity In 1960, Mr. Rosenberg founded an International Franchising Association, which gave Birth to the Business Franchising Model of the brand. This facilitated the rigorous and intensive preparation of any new Dunkin’ Donuts Franchise aspiring to carry the brand. In 1963, Mr. Robert “Bob” Rosenberg became the President and the Chief Executive Officer (CEO), which ensured continuity of the success the company had been experiencing. The establishment of the Dunkin’ Donuts University in 1966 paved the way for the four-week program, which aimed to equip participants with the knowledge and the discipline to sustain brand leadership. The Birth of the Philippine Brand of Dunkin’ Donuts In 1981, Golden Donuts, Inc. (GDI) became the Philippines Licensee to carry the Dunkin’ Donuts brand. It opened its landmark first shop at the Quad Car Park (now Park Square) in Makati. Responding to Sustainability Challenges A year after, GDI inaugurated four more shops as a response to whether it could really carry out a...
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...MINISTOP Philippines Case Study Distribution problems on channels institution 1. View point- employees franchisees and costumers 2. Time Context- 2004 3. Short historical background- On May 1980, Ministop was established as a wholly-ownded subsidiary of Jusco Co. Ltd. with an initial capital investment of 30 million yen. Ministop opened its first store in Okurayama in Yokohama, Japan on July 1980. On May 1985, MINISTOP's network breaks the 100 store mark with 80 franchised Stores and 20 stores directly managed. On November 1990, the first MINISTOP overseas store opens in Seoul, South Korea. By March 1998, their are 1,000 MINISTOP stores in full operation, 922 franchised stores and 78 stores directly managed. August 2000 was the date were MINISTOP, Philippines was established by, Robinsons Retail Group, Mitsubishi Corporation and MINISTOP Co., Ltd. on a seal Shareholder's Agreement. By December 2000, The first MINISTOP store in the Philippines opens at the MRT Central Station, a busy commercial hub. On May 2002, MINISTOP holds its first trade conference in the Philippines. The 50th MINISTOP store opens at Parc Chateau Ortigas Center on April 2003. Jan 2004, MINISTOP opens its 100 th store at Center point, Ortigas and celebrates with trade partners through ' Isang Daan to No. 1' conference. 4. Statement of the Problem After the 2 years of launching, mini stop is still losin.g money. Given the condition that it is the most growing convenience store in the Philippines 5...
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...BUSINESS FRANCHISING Top International Franchises Top National Franchises Submitted by: GERARD ANDREI B. DEINLA BSBA MARKETING MANAGEMENT Submitted to: DR. EDITH S. BUNUAN PROFESSOR IN BUSINESS FRANCHISING Top 10 International Franchises of 2014 The results of Entrepreneur's 35th annual Franchise 500 confirm that franchising continues to rebound, with these top 10 franchises leading the way. Here we highlight their success strategies and plans for the upcoming year. 1 Anytime Fitness Some 50.2 million Americans belonged to health clubs in 2012, according to the International Health, Racquet & Sportsclub Association. Today, about 1.9 million are Anytime Fitness members--a huge piece of the pie that's getting bigger every year. And it's safe to say that the 24-hour gym's clients, employees and franchisees are among the most enthusiastic people in the fitness industry. That's because the roughly 2,500 anytime clubs focus on people and culture. The company carefully selects its employees and treats them well, committed to the idea that a workplace should develop and challenge, not be stagnant or boring. Clients, meanwhile, appreciate the convenience of 24-hour accessibility to the small gyms--typically 2,500 to 5,000 square feet--whose staff and personal trainers take an interest and encourage them to push themselves. 2 Hampton Hotels Consider Hampton the U.S. ambassador of the hotel business. The company, which counts more than 1,900 units worldwide, has...
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...Global Marketing Management 1 Global Market Entry Strategies 2 Overview Target Market Selection Choosing the Mode of Entry Exporting Licensing Franchising Contract Manufacturing Joint Ventures Wholly Owned Subsidiaries Strategic Alliances 3 1. Target Market Selection A crucial step in developing a global expansion strategy is the selection of potential target markets. A four-step procedure for the initial screening process: 1. Select indicators and collect data 2. Determine importance of country indicators 3. Rate the countries in the pool on each indicator 4. Compute overall score for each country 4 Choosing the Mode of Entry Sample Decision Criteria: Mode of Entry Market Size and Growth Risk Regulatory Environment Competitive Environment Local Infrastructure Tax Breaks… 5 2. Choosing the Mode of Entry (contd.) • Emerging Countries (Vietnam, the Philippines) • Growth Countries (China, India) • Maturing and established Countries (South Korea, Taiwan, Japan) Company Objectives Need for Control Internal Resources, Assets and Capabilities Flexibility 6 2. Choosing the Mode of Entry (contd.) Mode of Entry Choice: A Transaction Cost Explanation Transaction Cost Analysis (TCA) Transaction-Specific Assets 7 3. Exporting Indirect Exporting Cooperative Exporting Piggyback Exporting Direct Exporting 8 4. Licensing Licensor and the licensee...
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...market. The market entry strategies use by the coffee shop in managing their foreign franchisees when expanding into Asia including master franchising and company owned-stores. A master franchise is a person or entity that provides services to franchisees in a specified territory, typically a major market, geographical region or even one or more countries. The marketing approach is essential to gain a competitive advantage in the foreign market. The construct included market entry, site location, and market positioning. The reason is to choose master franchise as its form of franchising is because of that the master franchising was the most popular mode of entry into distant band cultural dissimilar market such as Asia. The Coffee Bean & Tea Leaf found that the sale of a master franchise as a quick method of establishing a franchise operation. Instead of sub-franchising the units, the master franchisees prefer to own and run the entire unit. The reason also is too attributed largely to be limited size of the marketplace as the products are targeted at specific niche rather than the general public. It entered Singapore, Malaysia, and Taiwan by master franchising. In the other hand, the coffee shop prefers to use company-owned stores in Hong Kong, Australia and United States. Whereas for the more complex markets is more favored like Japan, Philippines and the Middle East. The company is quite geographically dispersed in Asia. * Recruitment, training and recognition program The...
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...performance in the entered markets 1. Target Market Selection A crucial step in developing a global expansion strategy is the selection of potential target markets. A four-step procedure for the initial screening process: 1. Select indicators and collect data 2. Determine importance of country indicators 3. Rate the countries in the pool on each indicator 4. Compute overall score for each country 2. Choosing the Mode of Entry Decision Criteria for Mode of Entry: * Market Size and Growth * Risk * Government Regulations * Competitive Environment/Cultural Distance * Local Infrastructure Classification of Markets: * Platform Countries (Singapore & Hong Kong) * Emerging Countries (Vietnam & the Philippines) * Growth Countries (China & India) * Maturing and established countries (examples: South Korea, Taiwan & Japan) Key criteria for choosing entry modes: * Company Objectives * Need for Control * Internal Resources, Assets and Capabilities * Flexibility Mode of Entry Choice: A Transaction Cost Explanation * Regarding entry modes, companies normally face a tradeoff between the benefits of increased control and the costs of resource commitment and risk. * Transaction Cost Analysis (TCA) perspective * Transaction-Specific Assets (assets...
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...to Coloane just to get a taste of the egg tart and bring some home for their family and friends. The bakery became Macau’s tourist attraction and even can be considered as the country’s trademark. As for Lord Stow’s, the egg tart sales comprise about 60% of the bakery’s revenue. Lord Stow’s business philosophy is to ensure that his produce is always fresh, healthy, natural, and of the highest possible quality. He refused to allow his range to include additives and preservatives which is common to other bakeries. Although reluctant to go international, there were a lot of offers to franchise from people around the globe. The first franchise store opens in Mongkok, Hong Kong in 1997, in Taiwan in 1998, Japan in 1999 and also in the Philippines later that year. Thailand in 2000, South Korea in 2001. There were a lot of hesitations as there were a lot of copy cats of the egg tarts suddenly came in existence in the market and such has greatly affected the sales of Lord Stows Bakery. CURRENT SITUATION After Andrew Lord Stow passed away in 2006, His sister Eileen and his daughter continue his bakery and carry his standards of excellence. Eighteen years after, Lord Stow’s Bakery in Coloane continues with its traditional, bespoke service and enjoys the English influence...
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...------------------------------------------------- Retailing A person who can communicate well, convince people easily, and sell something right off, fit well in the retailing business. By serving as the middleperson of producers and consumers, a retailer can earn money easily by selling food, apparel, home furnishings, appliances, automobile parts, and many other kinds of goods. Retailing is selling goods directly to consumers. This entrepreneurial activity is based on the understanding that while a customer keeps buying and never lets up, there are actually certain factors that keep a retailer’s sales up. Consumables and other products with recurring sales value have to be placed regularly on the customers’ homes and ultimately on the retailers’ shelves. Types of Retailing 1. Store-based retailing – Store retailing can take form of an over-the-counter service or a self-service store, a big department store, or a small kiosk offering a variety of goods. Store retailers operate on a fixed location which can draw a lot of walk-in customers. * Supermarket a large self-service store that carries a wide variety of household, food, and laundry products. Examples are Rustan’s Supermarket, SM Supermarket, and The Landmark Supermarket. * Convenience store a retail store that is located near a residential area that is usually open 24 hours a day , 7 days a week. Examples are Ministop, 7-Eleven, Shell Select, Caltex Starmart, and Petron Treats. The growth of the call...
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...International franchising is often regarded as a low-risk foreign market entry strategy. Does this view fully reflect the attraction of international franchising as a market entry mode? International trade is booming and the world is shrinking rapidly due to faster communication, transportation, and financial flows. Today’s business environment is undergoing fundermental transformation as a result of globalization (Kotler & Armstrong, 2001). According to Hodgetts and Luthans (2003), “globalization is the production and distribution of products and services of a homogenous type and quality on a worldwide basis”. According to Root(1994, P.2) the new global economy has created business environment that require companies to look past the traditional thinking of the domestic market, and start looking at business from an international perspective. The main challenge of global companies is to develop managers that are capable of working across cultures and who are competent in international business (Brake, et al. 1995, p. 2). According to Elashmawi (2000), companies that want to react effectively to changes in its global marketplace, has to have a flexible and adoptable corporate culture. Want (2003) explain corporate culture as the collective belief system that people within a company has about their ability to compete in the marketplace. According to Hoffman and Preble (2004), franchising is a well working theory that helps companies adapt to different cultures and business...
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...focus upon before launching market expansion, the roles of government in supporting international trade such as Foreign Direct Investment, how government should assist their businesses in competing in global arena either by protectionism or subsidizing, why has International Franchising strategy has work and what are the industries that have utilized this strategy for expansion successfully and why international business executive should pay attention to cultural influence in business negotiation process particularly Malaysia. Influence of globalization Globalization is taking significant role in many nations around the world. All products and services are strongly linked to each other. For example, different parts of computer can be manufacture in different location and assemble in China to save cost. Both developed and developing countries such as Malaysia are cautious of its benefits not only socioeconomically but also geopolitically. Realizing this, Malaysia has started to take initiative in globalization approach in the 21st century. For example, the export of Thai rice and sugar to Malaysia, telecommunication equipment to Vietnam, rice and vehicles including spare parts to the Philippines and electrical equipment, machinery, fruits and vegetables to Indonesia. Malaysia sustained a robust broad based growth in 2003, driven by strong domestic demand and sturdy export performance as a result of the influence of globalization. As stated in Economic Report of Malaysia...
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...BON APPETEA FRANCHISING INC. Submitted By: Yu, Franchesca L. Submitted to: Mr. Velez Date of Submission: October 27, 2015 I. BRIEF HISTORY OF BON APPETEA Bon Appetea is a brainchild of Thomas Pestano, a Culinary Institute of America graduate. His wide experience in the food and hospitality industry in the United States brought him back in the Philippines to put up a business in the fast food sector. Filipinos have always loved fast food, and he noticed that there is still a void left to be filled. As a result Bon Appetea was born. Its first venture into the fast food industry is with Bon Appetea Express Brew Tea shop located in Strata 2000, F. Ortigas Jr. , Ortigas Center, Pasig. Bon Appetea Express Brew Tea shop is the first tea shop to operate 24 hours a day. It is the first to offer innovative products such as alcohol- spiked concoctions. Bon Appeatea offers its customers a wide variety of tea-based drinks to choose from. Customers will also be able to choose the base teas such as Jasmine Green Tea, Assam Black Tea, and toppings such as tapioca pearls, coconut jellies, egg puddings and many more. Aside from developing kiosks/stalls, Bon Appetea is looking into developing and putting up full-sized dine-in stores. These stores will be offering a wider array of drinks and toppings to choose from. These store will also be offering food to complement its existing beverage lines. Bon AppeTEA is a unique franchise concept bringing the new...
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