You Own a Franchise of a National Chain of Quick

question 65

Essay

You own a franchise of a national chain of quick luncheon meals.The corporate office is conducting a nationwide marketing campaign introducing a $5.00 value meal option.This $5.00 value meal option severely cuts into you operating margins.Numerous complaints to the corporate office have resulted in the corporate office taking the position that "the franchisees need to be competitive and this $5.00 meal is competitive." You disagree,noting that even with an increase in store traffic,the reduction in revenue and margin produced by this value menu will result in a net loss for your store.What type of channel conflict is evident here

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Definitions:

Spending Variance

The difference between the actual amount spent and the budgeted or planned amount in a given period.

Planning Budget

A budget prepared for a specific level of activity, used for planning and controlling costs and resources in advance.

Travel Expenses

Costs incurred by an employee or a business when travelling for business purposes, which can include accommodations, meals, transportation, and other expenses.

Spending Variance

The difference between the actual amount spent and the budgeted or expected amount, used in budgeting and financial planning.