The importance of critical mass
by
Norton Rose
A number of potential franchisees are needed to give a franchised concept the critical mass that will define a recognisable brand. This may be 30, 50 or 200 depending on the nature of the business and the market. Similarly, such a number may be necessary to enable a franchisor to achieve the desirable economies of scale for network administration. A franchisor needs to invest in systems and quality personnel to support the franchise network and have franchisees happy to continue to pay their ongoing royalties.
Network critical mass is one of the key determinants of long-term success for franchisors and franchisees alike.
This article was created by Deacons . 20.07.2007
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