| The modern franchise business model has nearly 150 years of history, which is recognized as originated in the United States. China started its franchise business from the mid-and late 80s, less than 30 years. The world's leading fast food brand KFC entered China in 1987, had a very difficult beginning due to a number of problems, such as the qualified suppliers and logistics companies, local management personnel, etc.,. Franchise, as the major development model of KFC, also could not be carried out because of a lot of factors. In the implementation of a range of localization strategies, KFC gradually embarked on the fast lane of development. A new franchise business model-do not start from scratch was found through an active exploration and research to adapt to China's national conditions, which was widely used from 2000. In this paper, the new franchise business model has been compared with the classic franchise business model in several sides. The reason of creating a new franchise business model has been analyzed and risk control is mentioned as strength of it. Franchisor and franchisee would get win-win from this new model. It is recognized as a milestone in the history of franchise in China, and will impact franchise business all over the world whether in developed country or in developing country. It has a positive role for the franchisor and franchisee. At the same time, it will also bring some specific operating risks and a number of adverse factors for development to franchisor. Therefore, companies must fully consider the pros and cons of various models before make a decision. |
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