STRATEGIC PROJECT FRANCHISING: THE BUSINESS STRATEGY THAT CHANGED THE WORLD It is not necessarily news that over half of American retail dollars are spent through franchising organizations. It is not unusual for someone to rise early in the morning to have a quick breakfast at a restaurant, get an oil change, visit a dentist or doctor, buy medicine from a drug store, take clothes to the cleaners, work out at a fitness club, and pick up food for the family before returning home at night - all done through franchised establishments. Since the 1980s franchising has become the fastest growing method of doing business in the world. It has not only changed our marketing and distribution system but also our way of life. It offers tremendous opportunities for entrepreneurs and ordinary people to own a business as well as compete favorably with larger establishments. Important US Franchise Facts & Stats: There are an estimated 3,000 different franchisors (companies that sell franchises) operating in the U.S. today. There are over 800,000 franchise businesses across 300 business categories or industries in the U.S. Franchise businesses accounted for approximately 3% of U.S. GDP or a total of $495 billion in 2014. This number is projected to increase to $512 billion in 2015. Franchise businesses provide over 18 million jobs and generate over $2.1 trillion to the economy. The franchise industry accounts for over 50% of all retail sales in the US. A new franchise business opens every 8 minutes of every business day. Approximately one out of every 12 businesses in the U.S. is a franchise business. The average initial franchise investment is $250,000, excluding real estate. The average royalty fees paid by franchisees range from 3% to 6% of monthly gross sales. Most franchise companies have fewer than 100 units. The average length of a franchise contract is 10 years. Largest franchise business sector - Quick Service Restaurants (20%). THE ASSIGNMENT Choose a franchise company (franchisor) and write a case (story) about it. The case should be developed around a major strategic theme that is current and interesting (e.g. international expansion or competition). There are 2 parts to this assignment: 1. The Case writeup itself (average 12-15 pages of text, not including appendices and references). 2. Discussion questions (3 to 5) - these are to be developed after the case is written. The contents of the case shall include, but are not limited to, the following areas: Background of Company Vision, Mission, Goals & Objectives Description of Business & Products Business Model Franchise Model Company Performance (Financial & Strategic) - financial statements must be provided Management & Organization - organization chart must be provided Company's Strengths, Weaknesses, Opportunities and Threats Core Competencies and Capabilities Industry and Market Characteristics Competition and Competitor Information Major Issues and Problems - these must be current or ongoing For style guide, refer to the cases in the second half of the textbook. [Note: your case should read like a story rather than an analytical report]. References are very important and should follow the \"Endnote\" format. Upon completion, submit the case to Turnitin.com (instructions will be given). Target score must not be more than 10%. References Chan, Peng, and Justis, R., Franchise Management in East Asia, The Executive, May 1990. International Franchise Association, www.franchise.org Franchise Disclosure Documents (FDDs), www.freefranchisedocs.com/ California Department of Corporations, www.dbo.ca.gov 320 West 4th St, Ste 750 Los Angeles, CA 90013-2344