You have operated one of your property sites as a prototype for the Franchise Operation. The properties are all in upscale locations that support the Restaurant’s thematic Desert profile.
The new site has been test marketing the Franchise concept with the patented dessert brand, “Brain Freeze,” that savory specially formulated dessert treat created by Sally.
The desert has become so popular that many customers have requested extra take-home orders. A substantial number of patrons have even asked if the dessert would ever be sold separately in markets. The dessert menu has a strong sales position in overall restaurant sales and generated a cash flow that supported the entire overhead of the test model.
Your company is now ready to launch the Franchise Operation, but you must first prepare
To fully understand the nature of Franchises review the following documents:
- Your task is to assemble the preliminary documents used to establish a national Franchise operation. So far, you have:
- A Partial FDD Franchise Information (PDF) Download Partial FDD Franchise Information (PDF)outlining the Franchise requirements that legally permit your company to sell and enter into franchise agreements with franchisees.
- Compare the Partial FDD Franchise Information against the specifications found in the Electronic Code of Federal Regulations website (Links to an external site.) (ECFR). Make sure all statutory requirements are in the FDD. Document any missing sections highlighting any deficiencies or variations from the Statute if any. Using the FDD Franchise Agreement (DOCX) Download FDD Franchise Agreement (DOCX) provide detailed answers for each question answered, explaining why you chose your answer. Short, yes, or no answers are not appropriate, statements without support are not acceptable. Next, using the Partial FDD Franchise Information and any other appropriate information, complete the following:
As a part of the Restaurant’s long-range marketing plan, you invested in the purchase of national property locations of the now-bankrupted “Sahara Desert Dish” franchise properties. Based on your Discussion and Strategic Plan results, you both agree that it’s time to go nationwide with the company’s patented dessert brand, “Brain Freeze.” Examination of the company’s financial position, you now have a healthy portfolio of investments, product revenue, and cash on hand.
The Restaurant’s dessert menu has produced an exceptional revenue stream. These products can easily be marketed as a standalone venture. The company portfolio includes the Sahara Desert Dish property purchased in anticipation of this day. The properties are all in upscale locations that easily support the Restaurant’s thematic Desert menu.
Looking Sally straight in the eye, you state, “It’s now or never, we need to get that Franchise Division going.” Sally was taken aback by the use of her statement, inquiries whether the operation will interfere with her entering the third Gold Star competition. You reply, “If Wolfgang Puck can open up gourmet pizza shops, that’s the only incentive we need to startup our Desert franchise operation.” Sally fires back, “You’re the one studying business law! Why did it take you so long to bring it up?” Sally continues, “Start working on the documents, and I’ll get started on creating the franchise operations menu and food handling processes.”
In your Discussion, you covered all of the eventualities companies face in expansion periods. The initial investment in the bankrupt properties has positioned the growth in a prime position. The commercial paper securing the properties is almost paid off. Converting the properties into a new enterprise will reduce the carrying cost and increase the current revenue streams by a minimum of 20%. Franchise Licensing Fees and property leasing rentals will initially bump revenue by approximately 35%.
To start your review, first, research the requirements required to establish a legally recognized Franchise operation. Using the Strategic Business Plan and the other resources you now have, complete the Franchise feasibility information and determine what steps are needed to enter this highly competitive area. Review the resources and respond to the Assignment.
To fully understand the nature of Franchises, review the following Documents:
- Business Growth document and the new Strategic Plan
- Respond to the questions provided in the
- Test for Franchising Feasibility,
- Review Form 505, and
- Form 506.
Upload your responses. Use all available information from the case studies, the text readings, and all information available, and any other research. Where response requires information not explicitly presented, use your vision to fill in the gaps and answer the questions. Information not established in the case study can be found in the franchise information. Use the documents in your assessment of your company’s readiness to take the next steps to success. Leave no blanks, and do not submit short answers that do not explain the basis for your response.
Here are all of the related documents to fill out and submit: