Franchising is supposed to be the best option for expansion and revenue generation as it offers sustainable growth oriented business models without any cost incurred by the organisation. However, for the franchisee, it is very important to ensure that the brand image of the franchisor is retained and further developed. Such concern often raises conflicts between the two parties.
This paper will attempt to analyse issues related to franchising based on the case study of a franchising company. For this purpose, an organisation with franchising business model will be selected and its franchising related issues will be figured out. At first, a brief history of the organisation will be discussed to understand its business franchising model. Next, the issues underlying the franchising operations will be pointed out. For analysis and evaluation purpose, relevant data obtaining method will be discussed. Finally, the paper will conclude with some recommendations based on the analysis of the indentified issues.
For this project, the McDonald’s franchising business has been selected for case study. McDonald is a leading fast food retailer in the global fast food retail sector. It is operating in around 117 countries with nearly 32,000 local restaurants (McDonalds-a, 2010). In 1940, Dick and Mac McDonald opened a restaurant called ‘McDonald’s Bar-B-Que’ in California and later in 1948 it was named as McDonald’s. For the last 70 years, the giant food retailer has been operating its fast food business quite successfully (McDonalds-b, 2010). Satisfactory food quality and efficient services of McDonald has made it a brand image in the fast food service sector. For expansion purpose, the company had adapted franchising strategy in 1955 and at present, around 75% of its total restaurants are operated by independent franchisees. Currently,