Franchises


A franchise is a contract arrangement by which the owner of a trade name, trademark, copyright, or process grants permission to others to use this property in selling goods or services under specified conditions.

The purchaser of a franchise (franchisee) obtains the advantage of offering a well-known or unusual product that may already have wide appeal. The franchisee  also receives the benefit of mass buying and advertising. Typically, the buyer of a franchise may pay a flat fee for the franchise as well as an additional percentage based on sales. The franchisee may also be required to pay a fractional share of the franchisor’s promotional costs and to purchase certain supplies from the franchisor.

Contract and sales laws pertaining to franchises are comparatively new. If the franchise involves the resale of goods or food, both the franchisor and franchisee will usually be liable under a breach of warranty if the food or other merchandize is not wholesome or proper from the consumer’s standpoint. However, tort liability to a third person is usually the responsibility of the franchisee alone. In a case where the franchisee’s truck struck  and negligently injured a pedestrian , the franchisor would normally have no responsibility.

My Consultancy–Asif J. Mir – Management Consultant–transforms organizations where people have the freedom to be creative, a place that brings out the best in everybody–an open, fair place where people have a sense that what they do matters. For details please visit www.asifjmir.com, and my Lectures.

 

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Limited Warranty


A limited warranty is that does not meet the standards for a full warranty. For example, a limited warranty may cover only parts, not labor, or may require the purchase to return a heavy product to the seller or service representative for service. It may also require the purchaser to pay for handling or allow only a pro rata refund or credit, depending on the length of time since the product was purchased. Often, a limited warranty protects only the first purchaser.

My Consultancy–Asif J. Mir – Management Consultant–transforms organizations where people have the freedom to be creative, a place that brings out the best in everybody–an open, fair place where people have a sense that what they do matters. For details please visit www.asifjmir.com, and my Lectures.

Transaction-based Marketing Vs. Relationship Marketing


As marketing has entered the 21st Century, a significant change is taking place in the way companies interact with customers. The traditional view of marketing as a simple exchange process—a concept that might be termed transaction-based marketing—is being replaced by a different, longer-term approach.

Traditional marketing strategies focused on attracting consumers. The goal was to identify prospects, convert them to customers, and complete sales transactions. But today’s marketers realize that, although it remains important, attracting new customers is truly an intermediate step in the marketing process. Marketing efforts must focus on establishing and maintaining mutually beneficial relationships with existing customers. These efforts must expand to include suppliers and employees, as well.

The concept, called relationship marketing, refers to the development, growth, and maintenance of long-term, cost-effective exchange relationships with individual customers, suppliers, employees, and other partners for mutual benefits. It broaches the scope of external marketing relationships to include suppliers, customers, and referral sources. In relationship marketing, the term customer takes on a new meaning. Employees serve customers within an organization as well as outside it; individual employees and their departments are customers of and suppliers to one another. They must apply the same high standards of customer satisfaction to inter-departmental relationships as they do to external customer relationships. Relationship marketing recognizes the critical importance of internal marketing to the success of external marketing plans. Programs that improve customer service inside a company also raise productivity and staff morale, resulting in better customer relationships outside the firm.

Relationship marketing gives a company new opportunities to gain a competitive edge by moving customers up a loyalty hierarchy from new customers to regular purchasers, then to loyal supporters of the company and its goods and services, and finally to advocates who not only buy the  company’s products but recommend them to others. by converting indifferent customers into loyal ones, companies generate repeat sales. The cost of maintaining existing customers is far below the cost of finding new ones, and these loyal customers are profitable ones.

Effective relationship marketing relies heavily on information technologies such as computer databases that record customers’ tastes, price preferences, and lifestyles alongwith the increase of electronic communications. This technology helps companies become one-to-one marketers that gather customer-specific information and provide individually customized goods and services. The firms target their marketing programs to appropriate groups, rather than relying on mass-marketing campaigns. Companies who study their customers’ preferences and react accordingly gain distinct competitive advantages.

Firms in service industry, from retailers to hotels to airlines, are among the leaders in relationship marketing. Their staff members have many opportunities to meet customers personally and build loyalty and repeat business. Rewards for frequent buyers of a firm’s goods or services, such as hotel programs that reward frequent visitors with free room stays and other travel documents, are another form of relationship marketing.

My Consultancy–Asif J. Mir – Management Consultant–transforms organizations where people have the freedom to be creative, a place that brings out the best in everybody–an open, fair place where people have a sense that what they do matters. For details please visit www.asifjmir.com, Line of Sight