- •Донецький національний університет економіки і торгівлі імені Михайла Туган-Барановського
- •Economics Today
- •Content
- •Texts for Individual Reading
- •Передмова
- •Unit 1. What does economics study?
- •Vocabulary.
- •What does economics study?
- •Money price human wants scarcity
- •What does economics study?
- •Pronouns
- •Unit 2. Different Economic systems.
- •Vocabulary.
- •Different economic systems
- •Outstanding economists.
- •Unit 3. Economics as a social science.
- •Vocabulary.
- •Try to explain the above mentioned economic notions as you understand them, by your own words.
- •Economics as a social science.
- •Economics as a social science
- •Outstanding economists
- •Unit 4. Economics as a policy.
- •Vocabulary.
- •Economics as policy.
- •Economics and policy
- •Outstanding economists.
- •Unit 5. Main economic concepts.
- •Vocabulary.
- •Main economic concepts.
- •Outstanding economists.
- •2. Define:
- •Unit 6. Market, Supply and Demand.
- •Vocabulary.
- •Market, supply and demand
- •What money can’t buy
- •Outstanding economists.
- •Unit 7. Prices and their formation.
- •Vocabulary.
- •Price and its formation.
- •Past Tenses
- •When prices draw us.
- •Outstanding Economists.
- •2. Value:
- •Unit 8. Taxes and Taxation.
- •Vocabulary.
- •Taxes and taxation
- •Past Tenses Past Perfect Simple
- •Past Perfect Continuous
- •Will Germany Start Tax Reform?
- •Crackdown on “alcohol disorder zones”
- •Outstanding economists.
- •Sources of government revenue
- •Public spending
- •Unit 9. Business organization.
- •Vocabulary.
- •Forms of business ownership in the u.S.A.
- •The Formal Organization.
- •Up and Down of People Express
- •Burr’s Business
- •3. Necessity:
- •Unit 10.
- •Forms of business small business
- •I. Can you stick with it?
- •How to make business plan.
- •The Passive Voice
- •Unit 11. Franchising.
- •Vocabulary.
- •Franchising.
- •Evaluate your franchise opportunities.
- •Mc’Donald’s : burger and fries a la français.
- •Invest:
- •5. Tax:
- •Unit 12.
- •International Trade.
- •International trade.
- •How to avoid business blunders abroad.
- •Vocabulary to Text 2.
- •Advertising.
- •Vocabulary:
- •Answer the questions:
- •Economic theories.
- •Vocabulary:
- •Answer the questions:
- •Main economic concepts.
- •Vocabulary:
- •Answer the questions:
- •Management.
- •Vocabulary:
- •Answer the questions:
- •Marketing.
- •Vocabulary:
- •Answer the questions:
- •Types of economic systems.
- •Vocabulary:
- •Vocabulary:
- •Practical Tasks:
- •Text 2. Classical Theories.
- •Vocabulary:
- •Practical Tasks:
- •Text 3. The Meaning of Management.
- •Vocabulary:
- •Practical Tasks:
- •What is you understanding of management?
- •Vocabulary:
- •Practical Tasks:
- •Text 5. Management Activities.
- •Vocabulary:
- •Practical Tasks:
- •Text 6. Classical Theories.
- •Vocabulary:
- •Practical Tasks:
- •Text 7. Fayol's Principles of Management.
- •Vocabulary:
- •Practical Tasks:
- •Text 8. F.W.Taylor and Scientific Management.
- •Vocabulary:
- •Practical Tasks:
- •Text 9. The Principles of Scientific Management.
- •Vocabulary:
- •Practical Tasks:
- •Text 10. Scientific Management after Taylor.
- •Vocabulary:
- •Practical Tasks:
- •Text 1. Comments on the Scientific Management School.
- •Text 2. L.F.Urwick.
- •Text 3. E.F.L.Brech.
- •Text 4. Max Weber and the Idea of Bureaucracy.
- •Text 5. Bureaucracy.
- •Text 6. Bureaucracy after Weber.
- •Questions for Discussions to texts 1-6.
- •Nobel prize winners.
- •1975: Nobel Prizes.
- •Money in our everyday life quotations. Attitudes to money.
- •Giving away money.
- •Money and everyday life.
- •Money and the family.
- •Money at work.
- •Money madness.
- •Possessions.
- •The economic model.
- •The psychology of money.
- •The very rich.
- •Young people, socialisation and money.
- •Poetry.
- •I have some fe a rainy day underneath me bed,
- •Is dis culture yours, cause it is not mine
- •It could do good but it does more bad
- •The coin speaks.
- •The hardship of accounting.
- •The millionaire.
- •Keys unit 1.
- •Comprehension check.
- •Unit 2.
- •Comprehension check.
- •Unit 3.
- •Comprehension check.
- •Unit 4.
- •Comprehension check.
- •Unit 5.
- •Comprehension check.
- •Unit 6.
- •Comprehension check.
- •Unit 7.
- •Train and check yourself
- •Unit 8.
- •Unit 9.
- •Comprehension check.
- •Fill in the chart
- •Unit 10.
- •Unit 11.
- •Comprehension check.
- •Unit 12.
- •Keys to the texts for individual reading
- •Economics Today
Franchising.
One way to avoid some of the management headaches in business is to invest in a franchise, an approach that enables you to use a larger company's trade name and sell its products in a specific territory. In exchange for this right, the franchisee (you, the small business owner) pays an initial fee and often monthly royalties as well to the franchisor (the corporation).
Franchising is not a new phenomenon. It has been around since the nineteenth century, when such companies as Singer and International Harvester established dealerships throughout the world. Early in the 20th century, Coca-Cola, General Motors, and Metropolitan Life Insurance Company, among others, used trademark franchises to distribute or sell their products. But the real boom in franchising began in the late 1950s, with the proliferation of hotels and motels like Holiday Inn and fast-food establishments like Baskin-Robbins, and Dunkin' Donuts.
The latest trend in franchising has been diversification in the variety of products offered. Today over 2,000 companies offer franchises, ranging from day-care centers and health clubs to dental clinics, videotape rental outlets, and funeral parlours. By and large most are service operations. Why is franchising so popular? According to the president of the International Franchise Association, franchising has triple benefits: "The franchisor wins because he builds a strong foundation for his company. The franchisee wins because he can take advantage of the franchisor's proven business system, and the general public benefits from the consistency of the product or service".
The biggest winners are generally the franchisors, who are able to expand their businesses through franchised outlets without depleting their own capital. Take the case of Gymboree, for example. The company, which operates exercise centres for preschoolers, was founded in 1974 by Joan Barnes. Her first centre was an instant success, and she gradually added seven more wholly-owned outlets before deciding to franchise the business in 1980. Since then, 220 franchised centers have been opened, and 100 more have been sold. Investing in a franchise can also be good for the franchisee, because the risk is reasonably low. Only 4 to 6 percent of all franchise outlets go out of business each year. When you invest in a franchise, you know that you are getting a viable business, one that has "worked" many times before. You also have the advantage of instant name recognition and mass advertising. An independent hamburger stand can't afford a national TV advertising campaign, but McDonald's, Burger King, and Wendy's can. In addition to giving you a proven formula, buying a franchise helps you solve one of the biggest problems that small businesses face: lack of money. Franchisors generally use a number of methods to make sure the franchisee is on firm financial footing. Besides financial aid and advice, the franchisor gives a new franchisee training in how to run a business. McDonald's "Hamburger University" in Illinois gives a nineteen-day course to owners and operators, leading to a "Bachelor of Hamburgerology, with a Minor in French Fries." By offering this course, McDonald's is also able to teach standard procedures to each operator and thus maintain its distinctive image. Many franchise organizations offer advice on advertising, taxes, and other business matters, as well as instructions in the routine day-to-day operation of the franchise. Although franchising offers many advantages, it is not the ideal vehicle for everyone. For one thing, owning a franchise is no guarantee of wealth. It may be the safest way to get into business, but it is not necessarily the cheapest. According to some analysts, it costs 10 to 30 percent more to buy a franchise than to open a business independently. One of the most significant financial variables is the monthly payment or royalty that must be turned over to the franchisor. The fees vary widely, from nothing at all to 20 percent of sales. High royalties are not necessarily bad – if the franchisee gets ongoing assistance in return.
Another drawback of franchises is that they allow individual operators very little independence. Franchisors can prescribe virtually every aspect of the business, down to the details of employees' uniforms and the colour of the walls. Franchisees may be required to buy the products they sell directly from the franchisor – at whatever price the franchisor feels like charging. Franchisors may also make important decisions without consulting franchisees. Although most franchise opportunities are legitimate, it pays to be wary. Franchises and "business opportunities" are occasionally fraudulent.
COMPREHENSION CHECK |
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Exercise 1. Are these statements true or false?
Franchise is one of the most time consuming types of business in the world because organizational difficulties.
The first companies, used franchises to sell its production were General Motors, Coca Cola etc.
You can find any type of production or services in franchise business in our days, but by and large most are services.
There are no proofs for franchising benefits at all.
Franchising is advantageous for both franchisor and franchisee.
Franchising is the most profitable for franchisees.
Investing in a franchise can be good for franchisee because of the low risk.
The franchisee has no right to use brand name, enjoy instant name recognition and mass advertising.
Franchisors don’t give any training to new franchisees.
Owning a franchise is the safest way to get into business, but it doesn’t guarantee wealth.
The sum of royalty depends on the number and quality of assistance get in return.
Very little independence is one of the drawbacks of franchise.
Exercise 2. Answer the following questions.
What is a franchise?
What’s the difference between a franchisor and franchisee?
What are the advantages of franchise?
What are the drawbacks of that type of business?
Why doesn’t a franchise guarantee wealth?
What fees should franchisees pay to franchisor?
What does the sum of fee (royalty) depends on?
Is little independence merit or demerit for a franchisee? Why?
Exercise 3.