Module 7 - Franchising in the International and Global Setting Flashcards
What is International Franchising?
a method of expansion that new or established franchises can use to move into new geographical areas and markets.
this refers to a domestic business’s expansion into foreign countries and markets.
Replication
During the process of international franchising, companies often strive to replicate successful domestic business models in foreign markets.
Challenge
Differences in language, laws and financial systems between franchising business and host foreign market.
Benefits
International franchising means new markets with new customers and selling potentials.
International franchising also places company’s name and presence in a global market.
Adaptability
Learning to adapt to the needs and demands of a new foreign market can attract local customers and buyers and lead to higher business success in a new country.
Counsel
International franchising experts help companies understand a foreign market before expansion.
Different Types of International Franchise Models
(1) Master Franchising
(2) Regional Franchises
(3) Direct Franchising
(4) Area Developer
What is Master Franchising?
one of the most popular international franchise models and is considered to be one of the simplest ways to expand a franchise overseas.
What is Regional Franchises?
a good choice for a franchise model moving into a larger country or area, where it can be difficult for one master franchisee to manage the franchise operations across the whole area.
What is Direct Franchising?
a franchise model where the franchisor retains control and licensing of the franchise completely.
What is Area Development?
is used mostly in markets or sectors where sub-franchising isn’t permitted, and involves a development agreement between the original franchisor and a new franchisee, who will take on the role of franchisor in the new region.
