Question

A small seaside town lost a major manufacturing firm two years ago. The plant was the

town's biggest employer. When it closed, 450 people lost their jobs. The loss of taxes has
left the town scrambling to maintain community services. Several small businesses have
closed because the local economy is so bad. To help turn the community around, the city
council-has-recently voted-to encourage the growth-of-a-tourist-industry. It has miles-of---
sandy beach, largely undiscovered by tourists. As part of its program, the community is
offering tax breaks and low leases on city-owned properties suitable for shops and other
businesses. To qualify for this opportunity, entrepreneurs must be willing to establish a
tourist-related business, such as a wind- and kite-surfing business, bicycle rental, T-shirt
shop, restaurant, or tour business.
Imagine that you are looking for a business opportunity and have decided to apply for
one of the city's low-priced business sites. Identify a tourist-related business
like to open. It can be a partnership or a franchise. Then answer the questions.

1. What kind of business would you open?
3. Why do you think this business will succeed in the town?
2. Will you open the business as a partnership, and if so, what kind, or purchase a
franchise? Why?
4. What are the risks in opening this particular business? Consider how the franchise
or partnership organization reduces or increases the risk.
5. What are the specific benefits for you and for the town in opening this business?
Think about how having a partnership or franchise organization will affect the
benefits.
...

Answer 1

1. I would like to open a bicycle rental and repair shop in the town.
2. I think this business will succeed in the town because the town has miles of sandy beaches that are largely undiscovered by tourists. Tourists who come to the town will want to explore the area and a bicycle rental and repair shop will allow them to do that.
3. I would open the business as a partnership with someone who has experience in the bicycle rental and repair industry. A partnership would allow us to share the responsibilities and expenses of the business.
4. The risks in opening this particular business include competition from other bicycle rental and repair shops in the area, fluctuations in the local economy, and weather conditions that may affect the number of tourists visiting the area. A franchise organization may reduce some of these risks by providing a proven business model, marketing support, and training. However, a partnership may also help to reduce risk by sharing the responsibilities and expenses of the business.
5. The specific benefits for me and for the town in opening a bicycle rental and repair shop include the opportunity to provide a much-needed service to tourists visiting the area, the potential to generate income for myself and my partner, and the potential to create jobs for local residents. Additionally, the town will benefit from increased revenue from tourism, which can help to support community services.