Use Of Franchising Research Articles

Franchising as a tool for small medium sized enterprises (SME) development in transitional economies ‐ the case of central European countries

Assesses the benefits and limitations of franchising as a tool for the development of small‐to medium‐sized enterprises (SMEs); focuses on the use of franchising in transitional economies, with particular reference to central European countries. Reveals that franchising ‐ with its numerous advantages over conventional market entry ‐ has played a significant role in the development of SMEs in the industrialized West and transitional economies in general, but that in central and Eastern Europe the uptake of franchising has been negligible. Identifies that there are reasons, particular to these countries, including ‐ inter alia ‐ political, organisational, cultural, economic and legal, which make the use of franchising unattractive to both foreign and domestic franchisors; outlines the evolution of indigenous franchising in other transitional economies, citing successes in Asia. Summarizes the challenges facing Central European countries in realizing the potential of franchising in the development of SMEs, and suggests further areas for research.

Franchising, liquidity constraints and entry

The short- and long-run incentives to franchise are considered. While monitoring problems due to geographic dispersion ensure that franchising is an efficient organizational form in the long run, entry costs suggest that franchising is an efficient solution to the formidable problems posed by entry in the short run. This explains the intensive use of franchising in the early growth stages, followed by a greater proportion of company-owned outlets as the system matures.

Factors affecting European privatisation and deregulation policies in local public transport: The evidence from Scandinavia

This paper concerns itself with the question of the forces behind privitisation and regulatory reform in local public transport in Europe. Two different approaches to the explanation of the changes are presented: the political and the economic. The paper gives a review of current discussions and sets forward the hypothesis that even though there is much evidence to support a process of privatization and deregulation (with a vague rationale), much can be seen as a political process; the real objectives of change can be found in policies in advocating the need for reduced public expenditure and subsidies. Thus, the ideological side of change is weaker than the financial arguments. The paper discusses the process in Europe on the basis of an all-European survey, and concludes that there is no general trend towards deregulation in local public transport in Europe, but a trend towards the use of franchising in certain countries such as Norway, Sweden, and Denmark. The Scandinavian experience is dealt with and the results of change of policies are analyzed. The wider implications of regulatory reform in Europe are seen in the context of the development of the single European market, and the need for transport policies to account for environmental problems. All these factors indicate that there will be some change, but more cautions ones, and this again indicates that a franchising solution may be more likely than full deregulation in the European bus industry.