• Join over 1.2 million students every month
  • Accelerate your learning by 29%
  • Unlimited access from just £6.99 per month
Page
  1. 1
    1
  2. 2
    2
  3. 3
    3
  4. 4
    4
  5. 5
    5
  6. 6
    6
  7. 7
    7
  8. 8
    8
  9. 9
    9
  10. 10
    10
  11. 11
    11
  12. 12
    12
  13. 13
    13
  14. 14
    14

Looking at The Body Shop as an example of a franchiser.

Extracts from this document...

Introduction

Introduction I am doing this report on franchising. I am looking at The Body Shop as an example of a franchiser. The Body Shop has expanded hugely since it began life in a small shop in Brighton, East Sussex in 1976. It was a sole-trader business founded by Anita Roddick to enable her to raise her children whilst her husband was away. Originally it sold just over 25 hand made products in unusual packing. The Body Shop since has enjoyed rapid growth both in the United Kingdom and internationally through franchising. As in any business The Body Shops main aim is to expand in as many countries as possible and make as much profit whilst keeping a good company name. Some of Anita's famous on-going campaigns are against animal testing, supporting community trade, and increasing the self-esteem of its customers through a popular advertising campaign and to turn The Body Shop 'green' to protect the planet on which we live. All of these have helped to build The Body Shops good and well- known name. There is no doubting that Anita and many of her employees care about these issues but I think much of it is part of their long term business campaigning to achieve a long lasting generation to generation clientele. Action Plan I am investigating The Body Shop as an example of a company, which has expanded rapidly through franchising. ...read more.

Middle

Yet their profit has became less every year, this could be because of many reasons. The first is the company are not as economic has they have been in the past, they are spending more on production and advertising etc. The second is that they may be buying more of their franchised shops back to company owned shops. This shows that The Body Shop cannot budget its costs to increase its profits suitably for a business of its size. It is very expensive for the franchisee to invest in a company like The Body Shop because to get the investment fee of �250,000 and the further required premises costs, stock costs and running costs they would have to take out a very large loan and are likely to require more. They are likely to need more money and get this through an overdraft. With less they would have to pay a very large interest rate. The Body Shop have been operating franchises since 1978 when they opened a kiosk in Brussels. The Body Shop operates in 50 countries across 12 different time zones and in 24 different languages. They sell over 1000 different products. Their biggest outlet in a shopping mall in Canada and their smallest operated from a franchisee's living room in Malta. The Body Shop has 1917 outlets (September 2001) ...read more.

Conclusion

As an indicator to their success it shows that they are doing very well by the amount of revenue but are failing to achieve a high rate of profit. Looking at these different ways of measuring success I conclude that The Body Shop is achieving a good revenue, market share and increase in company size. But they are failing to run their business efficiently and achieve the highest rate of profit possible. I believe that using franchises has given The Body Shop larger profits and a bigger size than they would have achieved otherwise, this is why I believe The Body Shop has benefited the greatly from the franchises. I think that on the whole the franchise agreements between The Body Shop and the franchisee are fairly well managed and fair. I think the franchisee should be able to buy stock at about 50% off the recommended retail price but give the company a large percent of their annual turnover e.g. 5-10%. This way The Body Shop will still be making a reasonable profit and so will the franchisee. I also think that the 'set fee' needed to purchase a franchise is very expensive because the franchisee still has to pay for staff, premises, running costs and stock. I also think that it is unfair that the franchiser can terminate the contract without consulting the franchisee, which is the one who does the most work. This concludes my report on the success of The Body Shop as a franchise organization. ...read more.

The above preview is unformatted text

This student written piece of work is one of many that can be found in our AS and A Level Structures, Objectives & External Influences section.

Found what you're looking for?

  • Start learning 29% faster today
  • 150,000+ documents available
  • Just £6.99 a month

Not the one? Search for your essay title...
  • Join over 1.2 million students every month
  • Accelerate your learning by 29%
  • Unlimited access from just £6.99 per month

See related essaysSee related essays

Related AS and A Level Structures, Objectives & External Influences essays

  1. Spreadsheet Report for Tuck Shop

    Sheets, formulas and functions: I will create 10 sheets they will all contain different data, they are: * Sheet 1 - Week 1 Product Information * Sheet 2 - Week 1 Product Expenses * Sheet 3 - Week 1 Profit & Losses * Sheet 4 - Week 2 Product Information

  2. For my portfolio, I was asked to do an assignment on two businesses. I ...

    Tesco wants their suppliers to deliver the raw materials in time so they can produce good services to the customers so Tesco choose their location nearness to their customers and they want their raw materials such as flour need to produce for the bread in time.

  1. Ownership and finance for my business. The business I am doing is a clothes ...

    Partnerships are often favored over corporations for taxation purposes, as the partnership structure does not generally incur a tax on profits before it is distributed to the partners. Advantages: The main advantage of a having a partnership is shared responsibility.

  2. Subway Franchise

    a brand that consumers trust and identify will lead the sandwich bar gaining a stable market share, and loyal customers in a short space of time, and also some of the risk will be reduced. Overall, buying into a franchise enables entrepreneurs like me to have an opportunity to provide

  1. Barclays Investigating a Business

    As Barclays is already known for being 'one of the leading wealth managers in the UK' it would be beneficial for them to aim to expand further internationally as they already uphold a leading brand name. Barclaycard UK's first credit card which can be used to pay for goods and

  2. Investigating Business. Tesco PLC. I will be describing the aims and objectives of ...

    helping Tesco?s to achieve their aims and objectives ? I shall rank which activity is considered to be the most influential factor. I will then write an evaluation where I will make a judgement of how marketing activities, enterprise skills and teams have contributed to Tesco?s success.

  1. Applied Business. Investigating a business Preston Manor High School

    the way a business works or leave it in a position where it will be difficult to survive. This impacts the school communication by the use of computers, telephones etc. The better technology they have the more effective the communication will be.

  2. Identify all the considerations that need to be taken into account when planning a ...

    Estimates must be complete before the Gantt chart can be drawn. This is an example of a Gantt chart * ICT packages Using ICT packaging will be more efficient than using normal time keeping as a computer is capable of doing time management automatically; this will not only help

  • Over 160,000 pieces
    of student written work
  • Annotated by
    experienced teachers
  • Ideas and feedback to
    improve your own work