Despite its reputation among other types of marketing, franchising has some drawbacks especially in regard to the hospitality industry. All players often have problems they need to know in advance to minimize their impact on the life of the sign.
Financial problems: Leaders sign or brand want to develop their business. However, the organizational structure of a simple ordinary company can not achieve this success. Must then find the best alternative adapting to this context, as the franchise is a marketing principle in vogue for a decade.
However, many entrepreneurs complain require initial investment is too high for this option. It takes on average between 40 000 to 150 000 € per room to start his business. Moreover, delayed charges franchisees can disrupt cash and have a negative impact on the prosperity of the company.
Disadvantages for franchisors and franchisees
The franchisor knows no difficulty encountered with blatant than the initial investment. However, it must be conservative compared to fluctuations in the financial business to not be overwhelmed by problems. This situation can lead to the breach of contract because the franchisees require stability of the brand to grow their business also. Recruitment of employees must be the best possible criteria for not dealing with a malfunction of both franchises. This will cause damage to the reputation of the entire network.
Financial problems: Leaders sign or brand want to develop their business. However, the organizational structure of a simple ordinary company can not achieve this success. Must then find the best alternative adapting to this context, as the franchise is a marketing principle in vogue for a decade.
However, many entrepreneurs complain require initial investment is too high for this option. It takes on average between 40 000 to 150 000 € per room to start his business. Moreover, delayed charges franchisees can disrupt cash and have a negative impact on the prosperity of the company.
Disadvantages for franchisors and franchisees
The franchisor knows no difficulty encountered with blatant than the initial investment. However, it must be conservative compared to fluctuations in the financial business to not be overwhelmed by problems. This situation can lead to the breach of contract because the franchisees require stability of the brand to grow their business also. Recruitment of employees must be the best possible criteria for not dealing with a malfunction of both franchises. This will cause damage to the reputation of the entire network.
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