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Can Franchising as a strategy help organization gain market share globally case study as Starbucks - Essay Example

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Can Franchising as a strategy help organization gain market share globally case study as Starbucks

'The Word franchise is sometimes (particularly in the United States) is used in a wide sense more or less synonymous with distributorship. It is not a technical legal expression but in Europe the word generally connotes something along the lines of the setup described below. It is a distribution method described by a manufacturer or supplier who has developed a well known name and appearance for its product (usually including intellectual property rights). It may manufacture the goods itself or it may simply select goods produced by a third party. In the latter case the franchise maybe described as the business format franchise, since it is essentially a business format that is being exploited. In either case it will probably have established an 'image' for its existing sales outlets, connected with the physical appearance of the outlets and the business methods applied. These names 'trademarks' and image, will be known by the public and attract customers who recognize these familiar signs. Service franchises such as photocopy shops and hair dressing salons are also a type of business format franchise'2.
'The story of the Starbucks Corporation tells of one of the most successful business endeavors in recent memory. Unfortunately, if you dream of someday opening your very own Starbucks coffee shop, you should know that the Starbucks Corporation famously does not franchise its business operations. However, there are other ways to pursue a Starbucks franchise opportunity.The Starbucks Corporation is based in Seattle, where the first Starbucks stores were opened in Seattle's Pike Place Market in 1971. Howard Schultz, the director of retail and marketing for Starbucks, was inspired by the coffee culture of Southern Europe. Clearly, the Starbucks business model has attracted much success and attention. While many potential investors would relish the idea pursuing a Starbucks franchise opportunity, the company does not franchise their stores. There does exist another Starbucks franchise opportunity. The Starbucks Corporation does participate in the sales of license agreements to qualified businesses or individuals. The Starbucks license agreement allows a smaller company to sell Starbucks products and conduct its own operations. However, this smaller operation remains solely owned by the Starbucks Corporation. Another way to pursue a Starbucks franchise opportunity is through the route of a joint venture scheme. A joint venture scheme allows a company to align itself with the Starbucks Corporation in a hopefully mutually beneficial business relationship. The joint venture scheme is akin to the relationship forged between Barnes and Noble and Starbucks'3.

"Advantages & Disadvantages of Franchising"

'Just like any other business structure, a franchise is no exception to the rule of having both advantages and disadvantages associated with owning such a business. While our list will actually make the distinction ...Show more


There are two major characters in the process of franchising, a franchisor and a franchisee. A franchisor is the individual or company that owns a trademark or a brand name it provides certain support to the Franchisee, the individual or the company which uses the trademark or the brand name…
Author : dereck05
Can Franchising as a strategy help organization gain market share globally case study as Starbucks essay example
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