Question

2. a) Why is franchising an important strategy in marketing a good or service? Explain using an example.

b) What is a cartel and why are they often unsuccessful?

Answer 1

Franchising is a continuing relationship in a business wherein the franchisor gives a licensed privilege to the independent people called as franchisees, the right to do business in the market and offers assistance in using the trademark or brand name for a prescribed period time frame as per certain specifications and in return gives a monetary consideration. It is a significant strategy in marketing a good or service as it acts as twofold marketing strategy, in one approach it increases the sales of the parent company and in second approach it is taking care of the franchised outlets. A franchisor participates in brand promotion at the national level and its franchisees promotes at the local level. Moreover the franchisees are always searching for new opportunities to enhance their business. For example: If I take the franchise of McDonald it can assist me in achieving the financial independence by getting on board with an international powerhouse who can ensures a high level of success. Moreover ensures a branded marketing strategy for it's food items at each individual franchise location. The branded high quality, outstanding cleanliness, and service to the high value customers can help in successful marketing for franchisee.