Franchising networks - origins and development
The presented origins of franchising indicate its growing significance for the economy of several countries. Over the ages, the meaning of the term evolved, and so did the basic principles of franchising systems. Co-operation based on franchising networks, or similar, evolved from the traditional form, applying nothing but sole distribution as the advantage of such co-operation, to a far more complex model, involving a complete scheme of running a franchising system. Dynamic development of franchising took place in the second half of the 19th century, as a result of evolution of distribution systems. The main incentive for development of franchising was the tendency to increase integration and economic co-operation between independent businesses. Those links, as other forms of integration and co-operation, constituted one of the main forms of preventing fast processes of concentration taking place in industry and trade. Traditional organisation of channels of distribution was gradually substituted by systems based on vertical co-ordination, including franchising. At the moment in Poland, as everywhere else in the world, the described form of co-operation develops dynamically, and proves its suitability for a growing number of branches of trade, as well as services. Franchising is present in a multitude of areas, from fast food restaurants, cleaners, to retail and distribution of all kinds of products. The recent years saw intensification of expansion of new systems developing operation in market niches, i.e. executive services, exclusive wine shops, dating and matrimonial agencies, vegetarian bars, shoe cleaning services, and even private healthcare facilities. Based on the advantages of franchising, this form of co-operation is used for development of small and medium businesses around the world. It is so, because it constitutes one of the safest strategies of business development, allowing for significant broadening of distribution channels and territorial expansion. (author's abstract)
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