Franchising and the Parol Evidence Rule by Robert W Emerson

By Robert W Emerson

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Examples of product and trade name franchising include automobile dealerships, gasoline service stations, soft-drink bottlers, and farm equipment dealers. This type of franchising dominates the distribution field since the franchisee has assigned territory for distributing franchisor’s products. There is considerable competition and, to a certain extent, saturation among franchises within this category. The benefit to the franchisors using this type of franchising is that they can penetrate into a market that they are not familiar with or that they do not have resources to enter.

This further restricts the chances of a prospective independent small franchisee. Conversely, going with an established strong franchisor ensures to an extent well-established training program, sound operational procedures, effective distribution system for supplies and equipment, marketing and advertising help, and eventual surety of success. HISTORY AND DEVELOPMENT Franchising in principle, if not in its current form, has existed for many centuries. In early ages, kings and rulers granted the right to certain individuals to collect taxes.

If a bus pulls in front of the restaurant, all guests have to be served promptly; if not, the business is lost. This calls for different management arrangements and pricing structures to provide business at various time periods. For instance, hotels have varying rates during peak travel and convention times. Heterogeneity Services are performed, produced, and served by people (employees) to people (customers). People have different levels of performance and serving capabilities, which are affected by numerous psychological, social, economical, and other factors.

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