What are the primary advantages and disadvantages to establishing ...

[kfurse]

What are the primary advantages and disadvantages to establishing a franchise system (from the franchisor's point of view)?
 
  What will be an ideal response?

Question 2

More people are willing to serve on a company's board of directors than board of advisors.
 
  Indicate whether the statement is true or false

[jonathanballen97]

Answer to Question 1

There are two primary advantages to franchising. First, early in the life of an organization, capital is typically scarce, and rapid growth is needed to achieve brand recognition and economies of scale. Franchising helps an organization grow quickly because franchisees provide the majority of capital. Second, a management concept called agency theory argues that for organizations with multiple units, it is more effective for the units to be run by franchisees than by managers, who run company-owned stores. The theory is that managers, because they are usually paid a salary, may not be as committed to the success of their individual units as franchisees, who are in effect the owners of the units they manage. The primary disadvantage of franchising is that an organization allows others to profit from its trademark and business method.

Answer to Question 2

FALSE