Business Studies

Which of the following can be treated as disadvantages of Franchising? 


ANSWER

All of above


SOLUTION
Disadvantages of Franchising are as follows:
  • When a franchisee becomes skilled in the manufacture and marketing of the franchised products, there is a danger that the licensee can start marketing an identical product under a slightly different brand name. This can cause severe competition to the franchiser.
  • If not maintained properly, trade secrets can get divulged to others in the foreign markets. Such lapses on the part of the franchisee can cause severe losses to the franchiser.
  • Over time, conflicts often develop between the franchiser and franchisee over issues such as maintenance of accounts, payment of royalty and non-adherence to norms relating to production of quality products.
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Single Correct Medium Published on 18th 08, 2020
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