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Enterprise Growth Strategies — Entrepreneurship STD 12 Commerce — Question

CBSE BoardEnglish MediumSTD 12 CommerceEntrepreneurshipEnterprise Growth Strategies5 Marks
Question
How franchising helps start-ups?
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Answer

Franchising helps the start-ups in following ways:
  1. Working: Franchising changed the working of the start-ups because already the product carriers a name in the market already. The start-ups pay royalty to the franchisor. Startups save struggling time and money involved in the process.
  2. Training: Start-ups take up training to understand the product. Franchisors make franchises fully known with the product/ services. Start-ups are the sales person. And franchisors charge a fee for this purpose.
  3. Fast growth: The start-ups can grow fast without having to increase cost through increasing labour, operating costs, etc. because normally buyers straight away contact them.
  4. One plus one eleven: Franchises work for the benefit of franchisors i.e. they turn up one plus one eleven. Both are open to help each other. Franchisors' efforts to boast their franchises are always real and sincere. No clash of interest arises.

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