Case 6-Firehouse Subs

Page 1 of 3

Case 6-Firehouse Subs

By | October 2012
Page 1 of 3
case 10-firehouse subs

1. What advantages do franchisees gain when they buy their franchises? What disadvantages do they experience? Advantages:
Usually, a franchisee can get many benefit from buying the franchise. First, the franchisee get the chance to access to a "business system with a proven track record". By doing this, franchisee can have their own small business faster and operate it more efficiently. Second, Franchisors will offer training programs for their franchisees to improve their skills and help them gain more experiences. Third, By buying franchises, franchisees can use " a known and advertised brand name for a product or service, giving them the advantage of identifying their businesses with a widely recognized name". Furthermore, the franchisors will provide standardized quality of goods and services, national advertising programs and financial assistance. They will also help with site selection and territorial protection. Then, the most important factor that push the franchisees to buy franchises is the experiences and knowledges owned by the franchisors that can increase franchisees opportunity for success. Disadvantages:

1. There are many forms of franchise fees plus continuing royalty fees which the franchisees need to pay for. 2. In order to keep unified standards, the franchisees have to strictly follow the franchisors orders and decisions. 3. Franchisees can only sell services and products that are allowed by the franchisors. there is lack of freedom for them to choose product lines. 4." Market saturation is a very real danger".

2. Develop a lost of advantages and disadvantages for each of the three options the managers at Firehouse Subs are considering. A. Continue the existing local marketing efforts by franchisees. Advantages:

1. The company does not need to pay more advertising and consulting fees to agency. 2. The company does not need to make new marketing plans so they do not need to spend time and energy to convince...