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What are the advantages of franchising for the franchisor, and which options apply to them?

User Juvenik
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Final answer:

Franchising offers advantages for the franchisor such as expansion, capital, shared risk, and brand recognition. Franchisors have options like training, supply chain support, and marketing.

Step-by-step explanation:

The advantages of franchising for the franchisor include:

  1. Expansion: Franchising allows the franchisor to quickly expand their business into new markets without having to invest heavily in opening and operating new locations themselves.
  2. Capital: The franchisor receives upfront franchise fees and ongoing royalty fees from the franchisees, providing a source of capital for the business.
  3. Shared Risk: Franchising allows the franchisor to share the risks and responsibilities of operating new locations with franchisees.
  4. Brand Recognition: Franchising allows the franchisor to increase their brand presence and visibility by having multiple franchise locations.

Some options that apply to franchisors include:

  • Providing training and support to franchisees
  • Establishing a supply chain to support franchise operations
  • Providing marketing and advertising support for the franchise brand

User Jodian
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