Monday, June 23, 2008

After Botched Attempt Distribution Company Turns Again to Franchising to Grow Company in Today's Economy

According to this article, "K & N Electric – through its trade name K & N Mobile Franchises – is aiming to expand by implementing an updated franchise system, more than 20 years after a botched attempt in the 1980s. We’d like to grow the company and it’s very expensive for us to put trucks out, fully stock them, pay the salesmen for a year or so until they’re actually selling enough to pay their way,” Nelson said. “So the best way for us to grow rapidly is through franchising, which is why we started the franchise company.” After years of research the company is rehauling it's basic business model to capture as many new customers as possible. "Changes include reducing the franchise royalty rate from 13 percent to 9 percent, lowering the franchise fee from $23,500 to $10,000 and updating computer systems to expedite sales and service." Nelson remains optimistic despite the state of the economy saying "“If the economy is going well, everyone is manufacturing, buying new stuff, which uses our parts.”

Saturday, June 21, 2008

Arby’s® Signs Development Agreements with New and Existing Franchisees

According to this article, Arby’s Restaurant Group, Inc has signed development agreements with with five new and eight existing franchisees of the giant food franchise to open an additional 35 Arby’s® restaurants throughout the U.S. These include: "Jeff Davis, CEO of United States Beef Corporation, Arby’s largest franchisee with 252 restaurants across the United States, has agreed to open 11 more Arby’s restaurants in Kansas, Missouri and Oklahoma."

Wednesday, June 18, 2008

Cash-for-Gas Bill Becomes Law Despite Prohibitions in Franchise Agreements

A recent bill allowing gasoline stations to offer discounts to customers who pay in cash demonstrates that Franchise Agreements may not always be as iron clad as the franchisor intended. According to this article, "Gov. M. Jodi Rell on Tuesday signed a bill allowing franchisees of major oil companies to offer cash discounts to customers, even if their franchise agreements prohibit it." The bill does not mandate this action for gas stations, but it allows them to do this as an option.

Tuesday, June 17, 2008

Phoenix, Arizona Metro Light Rail May Provide Economic Boom for Metro Phoenix

The Metro Light Rail is expected to cover a 20 mile region including Phoenix, Tempe and Mesa and should be completed in December. According to this article, "Light rail is six months from operation, but the transit system's impact on the Valley's real-estate market has been in full swing with new condos, office buildings and mixed-use developments rising throughout metro Phoenix." There are detractors who believe it might be a burden on taxpayers (estimates put the figure at $6 billion for on public and private projects) associated with the rail. Also, construction of the line has effected the operation of nearby businesses. That said, "As the Valley's office market struggles to retain and attract tenants during the economic downtown, light-rail proximity also could be an effective marketing point for landlords trying to lease space." There's also thought that as gas prices increase, this can be a welcoming option for consumers.