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Camile Thai is a healthy, sustainable fast-casual restaurant franchise - Leaving Cert Business - Question 3 - 2021
Question 3
Camile Thai is a healthy, sustainable fast-casual restaurant franchise. (i) Explain the term franchising. (ii) Outline one benefit of a franchise as a start-up opt... show full transcript
Worked Solution & Example Answer:Camile Thai is a healthy, sustainable fast-casual restaurant franchise - Leaving Cert Business - Question 3 - 2021
Step 1
Explain the term franchising.
Answer
Franchising is a business model in which the owner of a brand (the franchisor) grants permission to another individual or entity (the franchisee) to operate a business using its name, trademark, and business systems. In this arrangement, the franchisee typically pays an initial fee and ongoing royalties to the franchisor in exchange for support, training, and the right to utilize the established brand and operational framework. This relationship allows the franchisee to benefit from the franchisor's established reputation and customer base while following specific operational guidelines.
Step 2
Outline one benefit of a franchise as a start-up option.
Answer
One significant benefit of a franchise as a start-up option is the reduced risk associated with a proven business model. Franchises often come with a track record of success, allowing new entrepreneurs to enter the market with an established brand reputation and operational support. This benefit lowers the risk of failure compared to starting a completely new business from scratch, as franchisees can leverage existing customer trust and familiarity with the brand.