An investigation into the factors that most often contribute to the insolvency of franchisee businesses in the Western Cape

Van Niekerk, Muller (2012-03)

Thesis (MBA)--Stellenbosch University, 2012.

Thesis

ENGLISH ABSTRACT: “The business format, franchising, can be defined as the granting of a license for a predetermined financial return by a franchising company (franchisor) to its franchisees. The grant entitles them to make use of a complete business package, including training, support and the corporate name which include all branding and logos. Through this enabling the franchisees to operate their own businesses to the same standards and format as the other outlets in the franchise chain” (Maree, 2007, p. iii). Franchising has grown in popularity for entrepreneurs and business people to start a business, a professional career and a way of creating employment. It is seen as a proven business system that is sold to a franchisee as “best practices knowledge” by the franchisor (Maree, 2007). Although the “best practices” approach is at the core of franchising very little research was found to exist that investigates the factors that influence the success or failure of franchisees. The lack of formal research in this regard gave rise to the research question as to what the factors are that will contribute to the failure and subsequent liquidation of franchise businesses in the Western Cape. Current franchise owners and entrepreneurs considering to enter into the franchising sphere need to ensure that they not only understand what factors will influence the success of their businesses, but possibly more importantly, they need to comprehend which are the factors that could potentially lead to the failure of the franchise business. Based on the theoretical research and the data gained from the questionnaire analysis, one can conclude that the majority of the factors discussed in this report contribute towards the failure of franchisee businesses in the Western Cape.

AFRIKAANSE OPSOMMING: Die besigheidsvormbekend as ‘n eksklusieweagentskap of konsessie (“franchise”) kanomskryf word as die verlening van ‘n lisensie of reg teen ‘n voorafbepaaldefinansieletariefdeur die konsessiegewer (“franchisor”) aansykonsessiehouers. Hierdie vergunningmaakdie konsessiehouersgeregtig op die gebruik van ‘n volledigebesigheidsmodelwatopleiding, ondersteuning en die maatskappynaam, sowel as allehandelsmerke en logos, insluit. Hierdeur word die konsessiehouers in staatgestelomhuleiebesighedevolgensdieselfdestandaarde en formaat as die anderafsetpunte in die konsessiegroeptebedryf (Maree, 2007) Die verskaffing van eksklusieweverkoopsregaan entrepreneurs en sakemensewathuleiebesighedewil begin, ‘n professioneleloopbaanwilbeoefen en werksgeleenthedewil skep, het in die jongstetyd al gewildergeword. Dit word as ‘n bewesebesigheidskonsepbeskou en word deur die konsessiegeweraan die konsessiehouer as “bestegebruikskennis” verhandel (vertaaluitMaree, 2007).Alhoewel die “bestegebruik”-benadering die kern van ‘n konsessie is, is slegskarigenavorsingmet betrekking tot die faktorewat die sukses of mislukking van konsessiesondersoek, tans beskikbaar. Die gebrekaanformelenavorsing in hierdie verband het aanleidinggegee tot die navorsingsvraagoorwatterfaktorebydraendkanwees tot die mislukking en gevolglikelikwidasie van konsessies in die Wes-Kaap. Huidigekonsessiehouers, asook entrepreneurs watditoorweegom die terrein van eksklusieweagentskappetebetree, moetnie net die faktorewat die sukses van hulbesighedesalbeinvloedverstaannie maar, stellig van groterbelang, die faktorewatmoontlik tot die mislukking van die besigheidkan lei, identifiseer en begryp. Na aanleiding van die teoretiesenavorsingwatgedoen is, asook die inligtingwat van die vraelys-ontledingsbekom is, kan tot die slotsomgekom word dat die meerderheidfaktorewat in hierdie werkstukbespreek is, tot die mislukking van eksklusieweagentskappe in die Wes-Kaap bydra.

Please refer to this item in SUNScholar by using the following persistent URL: http://hdl.handle.net/10019.1/20760
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