Franchising Inquiry Submission Assignment Example | Topics and Well Written Essays - 2250 words

Franchising Inquiry Submission - Assignment Example But the group wanted to focus on food either establishing their own restaurant or acquiring a franchise of a reputable restaurant or fast food brand. The group has decided to acquire a franchise of The Greasy Spoon, which is a well-known restaurant serving fried food. The Company was established in 2001 and has approximately 30 stores in Australia. All The Greasy Spoon stores are not Company owned and are available mostly in shopping malls. The stores are mostly located in Brisbane and Perth but the founders of The Greasy Spoon are planning to expand in New Zealand. The franchisee would propose setting up a Greasy Spoon franchise in Sydney. As for the location, the Queen Victoria Building appears to be an ideal place for the store. The five individuals comprising the group will also be in-charge of managing the store. The outright franchise fee for the store is $60,000 and the estimated start-up cost for the new franchise is $500,000. The owners of the franchise charge 15% royalty fees without marketing levy. Based on the 2008 Franchising Survey conducted by the Griffith University, food and accommodation services rank as second as the most preferred franchise in Australia. In terms of units, the aforementioned industry ranks as number one in number of units franchised. Overall, the franchising industry has improved by 15.4% as compared to the figures in the previous years. Business format franchises in 2007 amassed a total of $61 billion (Frazer, Weaven and Wright, 2009). The Ministry of Small Business and Economic Development seeks for some clarification regarding existing laws governing franchises. In Australia, there is no private group that oversees the welfare of franchisees and also ensures that clauses in franchise agreements are adhered to. But there have been rumors circulating that some franchisees are starting to gather to discuss the possibility of establishing a group catered to franchisees. There is no substantial literature