Sonic Franchise Essay Sample

9 September 2017

In 1954. Troy Smith established Sonic as a exclusive proprietary under another name and latter went on to get down up a partnership with Charlie Patton. There are four types of concern ownerships. exclusive proprietary. general partnership. franchise. and corporation. What are the differences between the four types of concern ownerships? If Sonic had remained a exclusive proprietary. would it hold grown every bit big as it is today? What advantages and disadvantages did Sonic travel through in each signifier of concern ownership? What makes one restaurant franchise more successful than other eatery franchises in the fast nutrient industry? Sole ownership is when no more than one individual owns and operates the company they have completed said sing the concern ( Nickels 2013 ) . In a exclusive proprietary should the company be unsuccessful. the proprietor is to the full responsible and suffers full loss. In a general partnership. both proprietors are accountable for the running and success of the concern. Should the company non win. both are responsible for the bills/operating disbursal of the company.

When it comes to franchising. several different people own franchised concerns but have to stay by the regulations set out by the proprietor/creator of the company. If one of the franchises should neglect. the company may lose a per centum of money they have been having from that shop. but merely a part from that peculiar franchise. The individual who franchised. or bought into the company loses what they put into the company to get down their franchised concern. Corporations are a whole other narrative. if they fail. the investors and everyone else involved stand to lose a great trade of money non merely from their stocks because they will be worthless. but because the owner/s of the company are non held apt for any of the concerns loses. If Sonic had remained a exclusive proprietary. it would non hold become every bit big as it is at this clip. They would non hold been capable to incorporate entree to the capital needed to turn and spread out. They would hold been able to turn by a little figure of shops ; and they would non hold been able to turn at the speed they did. Sonic went through advantages and disadvantages when they went through each signifier of ownership.

The advantages of sonic being a sole owned concern are the proprietor enjoyed the benefits of being his ain foreman. keeping of net incomes. and no particular revenue enhancements ( Nickels 2013 ) . The disadvantages are he had limited fundss. limitless liability. and limited growing potency. With general partnership. the advantages were shared fundss. shared liability. and better growing potency. The disadvantages of general partnership were limitless liability to both spouses. division of net incomes. and trouble of expiration. The advantages Sonic has had with franchise is a name recognized throughout the state. personal ownership. fiscal advice helping. and assist with direction and selling. The disadvantages of franchising are modulating the directors. limitations on selling. high start-up fees. and net income sharing. Sonics’ advantages of integrating are size. separation of ownership from direction. easiness of ownership. limited liability. and the ability to raise money for investing.

The disadvantages of integrating are dual revenue enhancement. extended paperwork. initial costs. and possible struggle with the board of managers and shareholders. The thing that makes one restaurant more successful than other restaurants would be. location. selling. word of oral cavity. nutrient quality. service. monetary value. and the people stand foring the company. Location is of import because if the eating house is out of the manner. it will be harder to happen and less likely to be visited by travellers. Selling is of import because it helps to advance the company. Word of is even better than customary advertisement because if you here the nutrient is high quality from person who has eaten there you are more likely to see and see for yourself.

Service is of import because if you as a client do non like the service. you will non return and are more likely traveling to state others about the hapless service you received doing them non to see the constitution every bit good. Price is besides a factor because there are many more lower income households than higher income out at that place. Meaning the lower income households can merely afford to eat out at certain constitutions that offer great nutrient at low-cost monetary values with their households. In decision: sonic has been in concern since 1954 and has grown from exclusive ownership into a successful public held corporation. They have been successful in portion because of they are able to supply great nutrient at sensible monetary values so most people are able to afford to eat out. They have a low operating expense because their dinner is your vehicle. so they do non hold to worry about the clean up from their clients.


Nickels. ( 2013 ) Understand concern 10th erectile dysfunction. . cp. 5. pgs. 134. 117. 119 Video Case ( Dec. 7 ) Sonic is dining!

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