Thougt it Was Safer Than Starting His Own Business Case Study

Thougt it Was Safer Than Starting His Own Business - Case Study Example Secondly, since he rose through the ranks, having retired as a senior execute from the previous firm makes Fred highly skilled in terms of possessing the knowledge, abilities and skills needed to operate a franchise within the same industry. However, there is disparity in the specific service offered by the previous organization he was employed with (automotive parts) and that of his franchise (car repair). Therefore, in terms of having direct and previous experience on operating a car repair business, Fred seemed to start as a neophyte in this kind of business endeavor. 2. Evaluate Fred’s misconceptions about being a franchisee. Speculate how common these misconceptions may be for all new franchisees. As indicated in the case facts, Fred perceived that there were apparent misconceptions in terms of â€Å"being his own boss and running his own company† (The Franchise Handbook, 2000, par. 5). According to Gappa (2012), â€Å"there are many misconceptions about franchising, but probably the most widely held is that you as a franchisee are "buying a franchise." In reality you are investing your assets in a system to utilize the brand name, operating system and ongoing support. You and everyone in the system are licensed to use the brand name and operating system† (Gappa, 2012, par. 5). ... red’s assertion that one of the misconceptions of franchising is thinking that when one enters into a franchising agreement, the franchisee would be his own boss and would run his own company. As a franchise, all the terms of the franchisor would be followed and adhered to. Likewise, it was emphasized that â€Å"as a franchisee you own the assets of your company, which you have chosen to invest in someone else's brand and operating system and ongoing support. You own the assets of your company, but you are licensed to operate someone else's business system† (Gappa, 2012, par. 11). It could be therefore common for new franchisees to assume that by entering into a franchise agreement, the new venture would give one the opportunity to own a business and be one’s own boss – since one would invest considerable amount of funds that could be parallel with investing on establishing a practically new business venture. The only difference in franchising is that one opted to invest in a previously established business with previously established historical performance to gauge customer’s response to the product (or service) and therefore provide a plus factor in terms of image, core competence and competitive advantage. 3. Suggest what Fred could have done differently to be better informed and advise Fred on action he can or should take now knowing his situation. For new entrepreneurs and business practitioners who are thinking of starting a new business venture or opting to enter into a franchising agreement, to be better informed, there must have been a more comprehensive and extensive research undertaken on the alternative courses of action: to establish a new business venture or to enter into a franchising agreement. There are advantages and disadvantages to both