BUISENESS MANAGEMENT
BUSINESS PLANNING
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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They enter into an existing market
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It is usually expensive to buy a franchise
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Market research is done by the franchisor
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The franchisor provides the franchisee with equipment
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Detailed explanation-1: -High Initial Investment One disadvantage of franchising can be the initial investment. The initial investment in a franchise can be hefty – the more established the franchise, the higher the likely initial cost.
Detailed explanation-2: -Disadvantages to franchisees include high costs and royalty payments, strict product rules, lack of support from uninterested franchisors, lack of flexibility in where to locate and how to trade, and other start-up challenges.
Detailed explanation-3: -Overall, buying in franchise is a good option if you want to start your own business but don’t want to oversee everything. You can get training and support from the franchisor, and there are some financial advantages as well. On the other hand, it’s expensive to buy a franchise or become an existing franchisee.