The Economics of Franchising

The Economics of Franchising

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This book describes in much detail both how and why franchising works. It also analyses the economic tensions that contribute to conflict in the franchisor-frnachisee relationship. The treatment includes a great deal of empirical evidence on franchising, its importance in various segments of the economy, the terms of franchise contracts, and what we know about how all these have evolved over time, especially in the U.S. market. A good many myths are dispelled in the process. The economic analysis of the franchisor-franchisee relationship begins with the observation that for franchisors, franchising is a contractual alternative to vertical integration. Subsequently, the tensions that arise between a franchisor and its franchisees, who in fact are owners of independent businesses, are examined in turn. In particular the authors discuss issues related to product quality control, tying arrangements, pricing, location and territories, advertising, and termination and renewals.Food was held so long and served so cold that McDonalda#39;s managers inspecting the stores found it difficult to eat. . . the ... our [Subwaya#39;s] Operations Manual. . . which contains mandatory and suggested specifications, standards, and operatinganbsp;...

Title:The Economics of Franchising
Author: Roger D. Blair, Francine Lafontaine
Publisher:Cambridge University Press - 2005-04-11

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