Franchisor Uncertainties

Peter M. Birkeland

in Franchising Dreams

Published by University of Chicago Press

Published in print May 2002 | ISBN: 9780226051901
Published online February 2013 | e-ISBN: 9780226051925 | DOI:
Franchisor Uncertainties

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This chapter examines more fully franchising from the franchisor's perspective. It specifically addresses some of the uncertainties they face in recruiting, monitoring, and managing franchisees. Franchisor uncertainties were the result of elements completely out of their control, such as the motives and wants of franchisees. There are three basic routes into franchising—vertical, horizontal, and random—and each impacts franchisors in significant ways. Vertical, horizontal, and random patterns of entry present management problems for franchisors. Franchisees and franchisors have different end goals. Franchisees wish to maximize profits, and franchisors maximize sales volume. Career paths affected the expectations of franchisees, impacted the actions they performed, and contributed to misalignment between franchisees and franchisors. The problem of control is the single greatest uncertainty facing the franchisor.

Keywords: franchising; franchisees; franchisors; franchisor uncertainties; recruiting; monitoring; management problems; career paths

Chapter.  6161 words. 

Subjects: Organizations

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