Case Study on Franchisor: Game Truck

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Added on 2019-10-08

Case Study on Franchisor: Game Truck

Added on 2019-10-08

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Game Truck Case Study2Franchising1.According to the case study Game Truck has become a franchisor. Provide adefinition of franchising?Franchising is a term used to define a business relationship between anestablished business proprietor and a dealer. In franchisor-franchisee relationship, thefranchisor provides the authority to other party, i.e. franchisee to conduct business underthe trade name of an established franchisor. The franchisor charges a particular amount ofannual payment along with some percentage amount of the total revenue or profit as aroyalty from the franchisee for the trade name Under franchisor-franchisee agreement, both the franchisor and franchisee ismotivated by mutual gains; the franchisor is motivated to expand its overall businesswithout investing further capital and franchisee is motivated to use the brand name of anestablished business based on the notion that starting from scratch involves lots of risksand is a time consuming affair.2.Business considering becoming franchisors must consider a number of possiblebenefits and challenges of this strategy. Explain two possible benefits and twopossible challenges and provide an explanation for each benefit and challengeidentified?Businesses considering becoming franchisors have to consider both challengesand possible benefits. Possible benefits and challenges and vary accordingly withdifferent types of businesses.Following are the challenges:

Game Truck Case Study3i)Products and services offered by the franchisors become a reputed tradeand brand name by the time franchising is considered and franchisors haveto make sure that the franchisee does justice to the brand name byadhering to the quality norms. Adhering to the quality requirement is anongoing process and not limited to one time quality check generally doneat the time of providing franchisee license. This becomes challenging attimes as it is not possible to monitor every activities of franchisees on adaily basis.ii)Franchisors are required to make sure that internal competitions amongfranchisees are avoided to invite franchisee application. An individualconsidering franchisee business would not want to engage itself in acompetition with any business holding the same franchise. This at timesbecomes challenging for franchisors since they must maintain a particulardistance from one outlet to another and they also have to consider thebusiness prospect of an identified area involving lots of market analysis.Following are the possible benefitsi)Franchisors can expand their businesses without having the need to investmanpower and capital once their brand name are well establishedgenerating profits in the form of franchisee fee and monthly royalties.ii)The franchise system allows the franchisors to access human capital of thefranchisee and bring them under the purview of the brand that helps tofoster innovation and further development of the business.

Game Truck Case Study43. What skills are needed by a small business team in order to become a successfulfranchisor?Becoming successful franchisors needs skills to identify sellable concepts,opportunities and threats to the prospective franchisors’ business. In the gametruck business case it is clearly seen that Novis, the owner of game truck at firstcame up with idea that is consumable in the market with patented rights. Oncethat patented rights are secured and the business becomes initially successful, thenext process of identification opportunities begin where Game Truck identifiesaccessible locations and interested participants in purchasing the trade mark andbrand name of the business.Identification of threats involves probable deterrence to franchisees ininitiating the deal and mitigates those threats. Game Truck headquarter base atArizona constantly evolves to bring innovative cutting edge technology and makethe gaming experiences cost effective for both franchisee and consumers. Onemust keep in mind that innovations are always vulnerable to upcoming radicalinnovations especially in the field of business that is technology dependent.4. Imagine that you are considering becoming a franchisee of game truck. Identifyand critically appraise two arguments in favor of becoming a franchisee in GameTruck?Having imagined always as a businessman and in born technocrats in me,Game truck franchisee is a big opportunity for me to involve myself with thebrand name that has redefined the gaming concepts in US. Starting a business

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Case Study on Franchisor: Game Truck