FRANCHISING AS A GROWTH STRATEGY. EVIDENCE FROM ROMANIA

• Main Authors: TRIPA Simona, CUC Sunhilde
• Format: Article
• Language: English
• Published: Editura Universităţii din Oradea 2014-05-01
• Series: Annals of the University of Oradea: Fascicle of Textiles, Leatherwork
• Subjects: economic; development; franchisor; franchisees; brands
• Online Access: http://textile.webhost.uoradea.ro/Annals/Vol%20XV-no%20II/Art.%20nr.%2069,%20pag%20183-188.pdf

There are many ways in which businesses can growth. Aim of this article is to make the business owner aware of the scope of the franchise and business opportunity law and how they may affect growth strategy tried to be employed by the business owner. For this purpose we present a list of advantages and disadvantages of franchising for the franchisee and for the franchisor and examined the status and trends of the Romanian market franchise, especially in clothing, which are available for prospective franchisees in Romania. We find out that although it is increasing its level of development is much lower than in EU, (according to Romanian Franchise Association in Romania are slightly over 400 franchises, with various business fields, while in the Europe there are about 10,000 franchise networks). Reasons for slower development of the textile franchise business in Romania can be found in the effects of economic crisis on the Romanian economy, which shifted the structure the consumer spending of the people of Romania, expenditures for clothing and footwear have decreased and have reached at 5.3% of total household expenditure. In these conditions, the clothing franchises who had suffered most in Romania were those whose offer to address at high-income consumers (Escada, Esprit, Etam) and medium (Debenhams, Gap). Less affected were franchises for which targets are low-income consumers and who besides the low price of products offers a wide range of products and models with a very short life cycle (fast fashion). The information for this paper was gathered from literature, from the analysis financial indicators of the different companies and by Internet