Bus366 Business | Role Of Assessment Answers

Answer:

Entrepreneurship played an important role in developing the Canadian Economy. When Canada emerged from high Recession, the government of Canada tried to figuring out that which kind of economic growth can create good jobs and future prosperity. Government of Canada declared 2011 as the year of entrepreneur. There are different types of entrepreneurship and one of them is high growth entrepreneurship. This kind of entrepreneurship provides a lot of innovation and job creation in the market. High- growth companies are known as gazelles. They are responsible for the innovative products, services and processes (Maciejewski, Jaana, Keely, Crowe & Liddy, 2018).

Due to this amazing economic impact, that high growth entrepreneurship has become an attention seeker thing for all the public policy makers in the world. It was also notable by President Obama also and he declared that high growth entrepreneurship is a central pillar of the economic policy agenda created by him. When Canada was leading the world with all public investment in Research and development, the highly educated population started new innovative businesses as there were low barriers (Pavlin, 2013). Canada was succeeded in the rising of new entrepreneurs in the country and that became an important aspect in the development of Canadian Economy.

There are different organizations or companies that are providing franchisee of businesses. These businesses are very profitable and people enjoy it a lot. McDonalds is a very renowned American fast food company. It was founded in 1940 by Richard and Maurice McDonalds in California, United States. It is world’s largest chain of restaurants that is serves over 69 million of customers in more than 100 countries. McDonalds serves different kinds of burgers, fries, chicken products and beverages. It is generating very high amount of revenues. It earns by sale of the products as well as franchisees provided to different people. There are some advantages as well as disadvantages of franchisee-

Advantages-

• Reduced Risk- There is many big chains that provide Franchisee. It is not important that everyone get success in franchisee but a good franchisee helps in reducing the possibility of failure. McDonalds is a very big brand and people like it so it is less risky to invest in the franchisee pf McDonalds.
• A proven system- Every franchisee has a predefined structure of operations and the processing tasks. Every franchisee receives proper training related to accounting, dealing with suppliers, manuals and usage of trademarks (Germann, Grant & Walker, 2007).The whole procedure of creating business is pre-defined and this helps in reduction of repeating past mistakes. McDonalds have also its particular way of doing all the operations and every franchisee holder needs to follow the same to maintain the quality of the product.
• Advertising- All independent businesses have to create advertisements on their own and they need a high amount of investment for that. In franchisee system, the whole advertisement cost is spread over all the units to gain economies of scale. This helps in creating advertisement in the most effective way.
• Reduction in stress- As there is a pre- planned roadmap to do the business activities; it helps in maintaining the efficiency and effectiveness of the business. It leads to hassle free business with no stress.

Disadvantages-

• Less independence- There is a loss of independence in franchisee business as firstly people think that it’s good to get the assistance in this business but afterwards they want to make changes according to them but they cannot do so. It creates a restriction in doing business according to our own choice (Ceil, 2017).
• Payment of fees- There is a high amount involve in buying a franchisee. An initial fee has to be paid to get the franchisee and in return they provide a grant and training. The initial fees are for a certain time period and afterwards they need to pay renewal fees in particular time duration. Some companies charge site selection fees and royalty too so it becomes really expensive to get a franchisee.
• Misunderstanding the franchise agreement- Sometimes, confusion might occur due to misinterpretation of information provided in agreement. It results in the loss of franchisor or franchisee and ends in a conflict. It is necessary to understand the agreement in a proper way to reduce the chances of conflict (Sousa, 2010).
• Failure to perform- Some franchisors are unable to perform according to the promise they made due to some circumstances. The most common reason for the same is the shortage of the capital. Some more reasons are wrong sales projections, high attrition, underestimation of expenses and failure to meet sales projections (???, Sang Deok Kim & Sejo Oh, 2014)

References

Ceil, C. (2017). Service Quality and Branding Strategies at McDonalds. SSRN Electronic Journal. doi: 10.2139/ssrn.2984100

Germann, S., Grant, A., & Walker, M. (2007). Franchising. [Wellington, N.Z.]: New Zealand Law Society.

Maciejewski, B., Jaana, M., Keely, E., Crowe, L., & Liddy, C. (2018). Social franchising: Scale and spread of innovation in Canada. Health Policy And Technology, 7(2), 217-223. doi: 10.1016/j.hlpt.2018.03.005

Pavlin, I. (2013). Opportunities for franchising development and employment generation: sustainable franchising as a form of entrepreneurship in Slovenia. International Journal Of Entrepreneurship And Small Business, 18(3), 262. doi: 10.1504/ijesb.2013.052516

Sousa, J. (2010). Understanding the Social Economy: A Canadian Perspective. Canadian Journal Of Nonprofit And Social Economy Research, 1(1). doi: 10.22230/cjnser.2010v1n1a22

???, Sang Deok Kim, & Sejo Oh. (2014). The Effects of Goal Incongruity between Franchisor and Franchisee on Regulatory Focus, Performance, and Opportunism of Franchisee. Journal Of Distribution Science, 12(2), 39-47. doi: 10.15722/jds.12.2.201402.3