Other advantages include better raising finance opportunities due to lower risks associated with already prevalent brand expansion, employee training by a franchisor, overall reduction of business risk to the franchisee, external benefiting from the expansion of the franchisor brand and chain, less expenses on advertisement and Public Relations campaign and access of the franchisor to most public advertisement resources, business insurance and further on. The study of Barrow, Golzen and Kogan accents that 'In the U.S.A., for example, McDonald's, one of the world's largest franchisors, spends more on TV advertising than Kellogg's, and virtually the same as the Ford Motor Company'. (Barrow, Golzen & Kogan 2000 p.37). As the franchisee operates in local to him market, he is able to exploit this insight knowledge and outperform the market prevalent competitors. According to Mendelsohn, 'Sales in 1997 reached £7 billion, compared with £5.2 billion in 1990, which represents somewhat less than the 50% increases in systems and franchisee numbers over the same period'. (Mendelsohn, M 2001 p.321). The operations manual provided typically by a franchisor to the franchisee benefits them both. 'The operations manual is a complete description of all the operating policies, procedures, methods and systems used to run the business'. (Clarke, G 1999 p.30). The operations manual enables the franchisor to make sure, that although each business is independently owned and operated, the same levels of quality and customer service are consistent throughout the network. A small business that is thinking about becoming a franchisor can illustrate how they want the business to be run on a day-to-day basis through the operations manual. An operational manual may include some of the following sections; opening hours and days, pricing policies,...
The operational manual is very useful to the franchisee in that it helps them with the day-to-day running of the business. Also if there are any changes made to the running of the franchise the operations manual will be updated accordingly. A franchisor like Kentucky Fried Chicken (GB) Ltd. may include the following sections in their operations manual; 'cleaning routines, recipes, methods of preparations of food, kitchen procedures and customer complaints procedures'. (Mendelsohn, M 2001 p.69).Our semester plans gives you unlimited, unrestricted access to our entire library of resources —writing tools, guides, example essays, tutorials, class notes, and more.
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