Application Exercise #6 Chapter 15 Franchising

Please do the following:

Review franchising opportunities by industry (category) on the international franchising association (IFA) website http://www.franchise.org/ .

Select an industry in which you are interested in exploring franchise opportunities. You many consider categories that you already identified when you completed application assignment #5 on business acquisition.

Review the listed franchising opportunities within the industry category and select two franchising companies that you believe will be successful in Wichita. Aim to select franchises that do not currently exist in Wichita.

Compare the two opportunities examining information/data included on the IFA website and the companys website. Pay particular attention to the fees and expenses required to operate the franchise as well as the promised support from the franchisor. Also examine the number of corporate owned and franchise businesses. Franchisors who run their own businesses are likely to extend better support because they know what it is like to operate the business. Further, the number of franchises can tell you how experienced the company is in supporting franchising. A small number of franchises can represent a high risk since the company is relatively new in supporting franchise partners.

1. Answer the following question - Which of the two franchise opportunities that you identified do you think would be the best for you to operate in Wichita and why? When justifying your preferred selection address the fee structure of the two opportunities, perceived franchisor support and structure, and the competitive environment in Wichita for such a business.

Answer questions 2-4 based upon the company you selected above.

2) Knowing that you will eventually review the Franchise Disclosure Document (FDD) that will reveal any legal cases and past financial statements generate a list of five questions that you would ask the franchisor to evaluate the potential of the franchising opportunity.

3) What questions would you ask franchisee owners of the company? (Create three questions)

4) Assume that you are the franchisor what questions would you ask a potential franchisee to determine if she/he has the potential to successfully operate a franchise? (Formulate three questions)