TY  - CHAP
AB  - Abstract Franchising manifests a bundle of risks created by the delegation of functions as both franchisor and franchisee exploit their respective comparative advantage. The galvanization of this advantage is governed by the franchise agreement and optimized by the effectiveness of the governance structure. This chapter considers the concept of risk and discusses its implications in valuing franchisee-operated businesses. It examines how risks arise, where they congregate and synthesizes the specific franchising issues relating to risk-adjusted cashflows, risk analysis, risk mitigation, and risk pricing. The authors propose that risks in franchising are multi-layered and hierarchical. Consequently, this relationship is represented in a Franchise Risk Ecology (FRE) comprising risks inherent in the market, the franchisor, the system, the industry, and within the franchisee-operated business.
SN  - 978-1-83909-286-2, 978-1-83909-285-5/
DO  - 10.1108/978-1-83909-285-520201009
UR  - https://doi.org/10.1108/978-1-83909-285-520201009
AU  - Roussety Maurice
AU  - Frazer Lorelle
AU  - Weaven Scott
AU  - Thaichon Park
ED  - Vanessa Ratten
PY  - 2020
Y1  - 2020/01/01
TI  - Franchise Risk Ecology: A Risk Ecology for Analyzing, Mitigating, and Pricing Franchisee-contracted Risks
T2  - Entrepreneurial Opportunities
PB  - Emerald Publishing Limited
SP  - 117
EP  - 131
Y2  - 2024/04/19
ER  -