What Are The Advantages And Disadvantages Of Export Industry

A franchise is a legal agreement between franchisers and franchisees that consents use of the franchise’s trademark and trade name or marketing plan

While doing some research I found that a franchise agreement is a binding legal contract that is signed between a franchisor and franchisee. A franchisor is the company owning the rights to grant franchises to franchisees, while a franchisee is a person or entity who is given the right to conduct business by a franchisor or licensor. The most important definition however is that of a franchise which is an authorization granted by the government or company to an individual or group allowing them to carry out certain commercial activities.

Franchising is a business model that allows companies to rapidly expand their market share. According to Franchise.com (2015), there are three types of franchises: distributorships, trademark licensing, and business format franchises. When two organizations enter into a distributorship, the originating company provides the rights another company to sell their products. An example of a distributorship is when an auto manufacturing company grants rights to a dealership to sell their vehicles (Franchise.com, 2015). Trademark licensing is when one company allows another company to use their trademark (Franchise.com, 2015). The business format franchise authorizes franchisees to sell the parent company’s products and/or services as well as utilize their business model. This type of franchising is the most common and is the type needed to obtain to open a new Cold Stone Creamery.

Franchise means “privilege” or “freedom” and the word originates from an old French dialect. The history of franchising can be traced back to the Middle Ages (476 A.D. – 1453 A.D.) when kings granted franchises to specific people or groups to perform a certain type of commercial activity or hunt on their land. German breweries in the 1840s also used franchising to distribute their beer to different geographic areas. The breweries granted the franchises to certain taverns to be the sole distributor of their beer in a specific area. Isaac Singer was known to pioneer the use of written franchise agreements. In the 1850’s, Isaac Singer started granting franchises for its sewing machines because he wanted to distribute his sewing machines to customers

* Outsourcing the labor in different stages (manufacturing, operational, etc.) allows for the company to save costs which can increase the profit margin and improve the financial situation.

According to the Franchise Law Journal, the franchise relationship consist of four elements: (1) the franchisor’s grant to the franchisee of the right to sell the franchisor’s goods and services, (2) a trademark that is licensed to the franchisee, (3) a community of interest wherein the franchisor exercises some measure of control over the franchisee, and (4) a fee paid by the franchisee to franchisor (Binford, Jason). The relationship is continually built from the agreements of business transactions and contracts that are very precise. After so much research within the 2, I would consider them as business partners instead of separate business parties because if it were considered a party, they would not have similar interest in the company’s future plan, in that case their would be

Franchising is simply a method for expanding a business and distributing goods and distributing goods and services through a licensing relationship. In franchising, franchisors not only specify the products and services that will be offered by the franchisees, but also provide them with an operating system, brand and support. (Franchise.org, 2016)

Legal factors- Different exporting laws pose as factors for companies to distribute their products as well as tax rates.

What is a Franchise: A franchisee pays an initial fee and a percentage of profit to a franchisor; in return, the franchisee gains the use of a trademark, ongoing support from the franchisor, and the right to use the franchisor's system of doing business and sell its products or services.

III. Possibilities to implement a new concept of management and run the business in a free world.

Franchising: it is a relationship in which the owner of the business allocates to independent individuals the right to market and distribute the goods or service, and by using the business’s name for a fixed period of time. The International Franchise Association defines franchising as a "continuing relationship in which the franchisor provides a licensed privilege to do business, plus assistance in organising training, merchandising and management in return for a consideration from the

Export subsidy reduce the price paid by foreign importers, which means domestic consumers pay more than foreign consumers. Export subsidies are government policies to encourage the outflow of goods and services from a domestic economy to the international market and discourage the sale of goods and services on the domestic market through direct payments, tax relief for exporters.

According to Daniels(2004), franchising is a specialized form of licensing for the franchisor. Not only sells an independent franchisee the use of the intangible property essential to the franchisee’ business but also operationally assists the business on a continuing basis through training and sales promotion.

The franchisor markets a unique business system under a trade name( use intellectual property) to run their own business.

Trade Policy Reforms: Trade Policy Reform liberalised the policy of import substitution mentioned earlier. As a result of which import license was abolished for capital goods & intermediates in 1993. Also govt. of India had adopted a flexible exchange rate in order to deal with balance of payments through exchange rate flexibility. On April 1, 2001 after 10 years the reforms started finally restrictions imports of manufactured products and agricultural products were removed (Ahluwalia*). So, abolishment of import license was the first element of the trade policy, the second element of this strategy was to reduce tariff protection. Average rate of import duty which was 72.5% in 1991-92 had been reduced to 24.6% in 1996-97. But again in next