Warm-up exercise: What is behind these signs?

Look at the following signs and see what business activity they remind you of.

You know the above signs are very popular brand names throughout the whole world. Do you know what business activity is the most important element in making them so successful? Choose one from the following business activities:

1. import & export trade
2. commercial meeting
3. after-sales service
4. foreign currency exchange
5. client/customer service
6. negotiating a new contract
7. market research
8. advertising campaign
9. franchising

Franchising is the business activity which has made these brand names popular all over the world. Do you agree?

Task one: Understanding franchising

1. Now let's watch a video clip about franchising. You know that franchising is now popular in China. Can you state what a franchise is according to the video clip? The following statements describe franchising business. See if they are true or false based on what you have watched. If it is true, click on the T column. If it is false, please click on the F column:

	T	F
1) If you get a franchise, you are given a license to distribute a product or service in an area.
2) Franchising business should have two parties: a seller and a buyer.
3) The seller usually has a recognized brand name.
4) If you buy a franchise you get a proven method of doing business.
5) If you buy a franchis you'll probably have a lower failure rate in business.
6) to buy a franchise, you only need to pay a small amount of money.
7) Franchising is only possible in the food industry.

2. Watch the video and fill in the blanks with following words or phrases:

1) The party that sells the license is the (franchiser) while the buyer of that license is the (franchisee) .
2) If you buy a franchise, you get (distribution) the rights for a product or service. You also (get access to) a complete system of business associated with the product or service.
3) Franchises, according to some studies, have a lower failure rate than other (start-up) businesses.
4) Buying a franchise still involves (risk) as well as a substantial amount of investment in money and time.

1. 1) T 2) T 3) T 4) T 5) T 6) F 7) F 2. 1) franchiser, franchisee 2) distribution, get access to 3) start-up 4) risk

Task two: Find the advantages and disadvantage of franchising

Since everything has two sides, franchising has its advantages and disadvantages as well. Watch the video and find its advantages and disadvantages:

Advantages: Some studies show that franchising has a lower failure rate than other start-up businesses. Four reasons for this are mentioned. What are they?
1.
2.
3.
4
Disadvantages:

Advantages: With a good franchise, you get help that you wouldn't have if you were starting a business from scratch: things such as name recognition for your product or service, training, and a proven method of doing business and access to mass purchasing power. Disadvantages: Buying a franchise still involves risk as well as a substantial amount of investment in money and time.

Word study

franchise
n. a license to distribute a specific product or service in a specific territory 特许权，经销权，许可，认可，专卖
Buying a franchise still involves risk as well as a substantial amount of investment in money and time.
购买特许经销权需要投入大笔金钱和时间，仍然是有风险的。

license
n. a printed form giving you permission to do something
许可证，执照
You must get a legal license from the KFC company in order to open a KFC outlet in China.
要在中国开一家肯德基店，你必须从肯德基公司获得一张合法的许可证。

distribute
v. to divide something among people
分销，分配
The aim of a franchise is to distribute a specific product in a specific territorial area.
特许经营的目的就是在某个具体的地域分销某种具体的产品。

get access to
gain entry to somewhere
可以使用，可以进入
You also get access to a complete system of business associated with the product or service by buying a franchise.
购买特许经营权后，你就可以使用与产品或服务相关的一整套商业体系。

start-up
beginning to do something
开始经营，开始着手
Franchises have a low failure rate than other start-up business.
特许经营与其它刚开始创建的生意相比失败率很低。

mass purchasing power
people's ability to buy something
大众购买力
One of the advantages of buying a franchise is that you do not need to worry about mass purchasing power.
购买特许经营权的优点之一就是你不用为大众购买力担心。