If a Franchise System Is Struggling,not Achieving Long-Term Success

question 9

Multiple Choice

If a franchise system is struggling,not achieving long-term success.The first step for the franchisor to do is:

• A)revisit and maybe change the franchisee business model
• B)contact and listen to each franchisee as possible,to determine what are the problems to be addressed.
• C)change the corporate business model,reduce corporate costs and reduce contact with franchisees.
• D)study what the competition is doing and change the franchise model to fit the models of its primary competitors.

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Definitions:

IRR (Internal Rate of Return)

The rate of return that brings the total net present value of all cash flows from a given project to zero.

Independent Project

A project whose cash flows are not influenced by the acceptance or non-acceptance of other projects, allowing it to be evaluated on its own merits.

Explicitly Considered

Directly factored into an analysis or decision-making process without assumptions or implications.

Cash Flows

The total amount of money being transferred into and out of a business, particularly in terms of operational activities.