FRANCHISING IN THE SYSTEM OF INCREASING THE INNOVATIVE LEVEL OF THE COUNTRY'S DEVELOPMENT
DOI:
https://doi.org/10.31891/mdes/2023-10-9Keywords:
franchising, franchisor, franchisee, innovation, technology, businessAbstract
The article substantiates the role of franchising in the system of spreading innovations (technical, technological, organizational, managerial, marketing). Franchising is characterized as a form of technology transfer for the development of not only small and medium-sized business entities, but also the country's economy as a whole; as a convenient way to enter the international market. The positive effects and negative aspects of franchising for the franchisor and the franchisee are systematized. Among the positive aspects of franchising for the franchisor, the following are highlighted: receiving income from the sale of the franchise and regular financial income; entering a new market / expanding the market (network); receiving suggestions for business improvement. Possible negative aspects of franchising for the franchisor are defined as: additional costs (financial, labor, etc. for the creation / development of contracts, costs for business development systems, presentation of standards, etc.); name risks; risks of plagiarism. The positive aspects of franchising for franchisees are defined as: obtaining the opportunity of an easy way to enter the market; sustainability of the business due to its popularity, revenue generation, profit; the opportunity to gain business experience; assistance in conducting business, including advertising (depending on the terms of the contract). The negative sides and limitations of franchising for franchisees can be: high purchase price of a well-known franchise; royalty payments and other current expenses; certain requirements, restrictions according to the terms of the contract offered by the franchisor. An analysis of the Ukrainian franchising market was carried out; well-known representatives - franchisors - are singled out. It was found that the majority of Ukrainian franchise systems were started and concentrated in Kyiv; most franchisees are also located in the largest cities of Ukraine: Kharkiv, Dnipro, Odesa and Lviv. It was found that the common directions of franchises in Ukraine are public catering (cafes, restaurants, pizzerias, etc.), services (sports clubs, dance schools, foreign language schools, salons, development clubs, etc.) and retail (online and offline stores selling food and goods). Trends and problems of franchising development in Ukraine are analyzed. Tools for promoting the development of franchise networks are outlined.
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