This is the case study, i need to answr the question from this case study..hep me plz..really stuck..

question: What other reasons may explain the fact that 15 per cent of Domino’s outlets are managed directly by the company rather than by franchees?
Domino’s Pizza Group

Many people dream about setting up their own restaurant. For somebody who loves food, the prospect of giving up a 9am to 5pm office job and spending all their working life developing new menus may seem irresistible. Sadly, although thousands of people have ventured down the route to becoming a restaurateur, the success rate is low. Estimates vary, but it is generally reckoned that about three quarters of all new restaurants are not a success and close within three years of opening. Large corporate restaurant chains generally succeed better, and it is the sole trader that is particularly likely to face problems. Instead of experimenting with new recipes for beef bourguignon or duck a l’orange, the small restaurant owner is likely to spend much of their time on more mundane matters. Filling out the VAT return, recruiting staff, calculating their income tax and paying their National Insurance contributions, keeping abreast of new legislation concerning minimum wage levels, maternity leave, and disabil¬ity discrimination are all distractions from the kitchen. Then there is the never-ending task of promoting the restaurant. Many restaurateurs think that customers will beat a path to their door, but diners can be fickle, and, as soon as a new restaurant opens in town, they may be off to try it out.

With so much to do in simply running the business, it is not surprising that many small restaurateurs become disillusioned and move on. Some fail simply because they haven’t developed a realistic business plan. Many of these could have benefited by belonging to a franchise organization, rather than going it alone. In franchised systems, the franchiser typically provides valuable support for administrative and promotional matters, leaving the franchisee to develop their business. Within the restaurant sector, franchising has been relatively slow to take hold at the gourmet end of the market, where the owner’s individuality and style can add to the appeal of a restaurant. But in the convenience food sector, franchising has become popular and allows dedicated individuals to build a secure and profitable business.

The Domino’s Pizza Group has used the energy of talented and hard-working indi¬viduals to deliver good financial rewards to its franchisees. Although the company’s pizzas may not appeal greatly to people who love fine food, its approach to the franchising of food outlets generally offers much more security and profitability than going it alone. In 2004, Domino’s reported that ten of its 100-plus UK and Ireland franchisees owned businesses that were worth more than £1,000,000 each. These figures are based on a standard calculation of twice annual turnover. With an average start-up cost of £183,000 this is a significant return on franchisees’ initial investment. How many sole traders running their own restaurant could match this? In 2002, Domino’s franchisees earned around £120,000 a year on average (although some considerably more), which was more than three times the average income of a typical business manager (£38,1071). Further¬more, no Domino’s franchise failed during the year, compared with over 22,000 business failures elsewhere in the UK economy.

Domino’s research into the skills set and characteristics of the most successful fran¬chisees, both in the UK and internationally, has found that the majority of franchisees believed the traditional corporate management career path failed to offer either the scope to succeed or adequate financial rewards.

Typical of the hard-working individuals attracted to a Domino’s franchise was James Swift. As a 16-year-old delivery driver for Domino’s Pizza, Swift spotted the potential to run his own business at an early age. He soon secured a position as the manager of the Domino’s branch in Swindon. This operational experience was critical for learning everything from how to make a pizza to how to manage a big team. It was about three years later that he got the chance to buy a share in the franchise. By the age of 24, he had become co-franchisee of three Domino’s outlets in Swindon, Newbury and Bath. He put his success down to sheer hard work and determination, with the backing of a well-known brand and the commitment that only the owner of a business can give.

Maybe one day, James Swift will match the success of Richard P. Mueller, Jnr, Domino’s Pizza’s most successful global franchisee. Mueller joined Domino’s in 1967 as a delivery driver and became a franchisee in 1970. By 2003, he owned 158 stores in the USA and employed over 3,000 team members. His company sold over ten million pizzas a year, as many as the entire UK Domino’s business. That equated to five million pounds of do

This is the case study, i need to answr the question from this case study..hep me plz..really stuck..

question: What other reasons may explain the fact that 15 per cent of Domino’s outlets are managed directly by the company rather than by franchees?
Domino’s Pizza Group

Many people dream about setting up their own restaurant. For somebody who loves food, the prospect of giving up a 9am to 5pm office job and spending all their working life developing new menus may seem irresistible. Sadly, although thousands of people have ventured down the route to becoming a restaurateur, the success rate is low. Estimates vary, but it is generally reckoned that about three quarters of all new restaurants are not a success and close within three years of opening. Large corporate restaurant chains generally succeed better, and it is the sole trader that is particularly likely to face problems. Instead of experimenting with new recipes for beef bourguignon or duck a l’orange, the small restaurant owner is likely to spend much of their time on more mundane matters. Filling out the VAT return, recruiting staff, calculating their income tax and paying their National Insurance contributions, keeping abreast of new legislation concerning minimum wage levels, maternity leave, and disabil¬ity discrimination are all distractions from the kitchen. Then there is the never-ending task of promoting the restaurant. Many restaurateurs think that customers will beat a path to their door, but diners can be fickle, and, as soon as a new restaurant opens in town, they may be off to try it out.

With so much to do in simply running the business, it is not surprising that many small restaurateurs become disillusioned and move on. Some fail simply because they haven’t developed a realistic business plan. Many of these could have benefited by belonging to a franchise organization, rather than going it alone. In franchised systems, the franchiser typically provides valuable support for administrative and promotional matters, leaving the franchisee to develop their business. Within the restaurant sector, franchising has been relatively slow to take hold at the gourmet end of the market, where the owner’s individuality and style can add to the appeal of a restaurant. But in the convenience food sector, franchising has become popular and allows dedicated individuals to build a secure and profitable business.

The Domino’s Pizza Group has used the energy of talented and hard-working indi¬viduals to deliver good financial rewards to its franchisees. Although the company’s pizzas may not appeal greatly to people who love fine food, its approach to the franchising of food outlets generally offers much more security and profitability than going it alone. In 2004, Domino’s reported that ten of its 100-plus UK and Ireland franchisees owned businesses that were worth more than £1,000,000 each. These figures are based on a standard calculation of twice annual turnover. With an average start-up cost of £183,000 this is a significant return on franchisees’ initial investment. How many sole traders running their own restaurant could match this? In 2002, Domino’s franchisees earned around £120,000 a year on average (although some considerably more), which was more than three times the average income of a typical business manager (£38,1071). Further¬more, no Domino’s franchise failed during the year, compared with over 22,000 business failures elsewhere in the UK economy.

Domino’s research into the skills set and characteristics of the most successful fran¬chisees, both in the UK and internationally, has found that the majority of franchisees believed the traditional corporate management career path failed to offer either the scope to succeed or adequate financial rewards.

Typical of the hard-working individuals attracted to a Domino’s franchise was James Swift. As a 16-year-old delivery driver for Domino’s Pizza, Swift spotted the potential to run his own business at an early age. He soon secured a position as the manager of the Domino’s branch in Swindon. This operational experience was critical for learning everything from how to make a pizza to how to manage a big team. It was about three years later that he got the chance to buy a share in the franchise. By the age of 24, he had become co-franchisee of three Domino’s outlets in Swindon, Newbury and Bath. He put his success down to sheer hard work and determination, with the backing of a well-known brand and the commitment that only the owner of a business can give.

Maybe one day, James Swift will match the success of Richard P. Mueller, Jnr, Domino’s Pizza’s most successful global franchisee. Mueller joined Domino’s in 1967 as a delivery driver and became a franchisee in 1970. By 2003, he owned 158 stores in the USA and employed over 3,000 team members. His company sold over ten million pizzas a year, as many as the entire UK Domino’s business. That equated to five million pounds of do

This is the case study, i need to answr the question from this case study..hep me plz..really stuck..

question: What other reasons may explain the fact that 15 per cent of Domino’s outlets are managed directly by the company rather than by franchees?
Domino’s Pizza Group

Many people dream about setting up their own restaurant. For somebody who loves food, the prospect of giving up a 9am to 5pm office job and spending all their working life developing new menus may seem irresistible. Sadly, although thousands of people have ventured down the route to becoming a restaurateur, the success rate is low. Estimates vary, but it is generally reckoned that about three quarters of all new restaurants are not a success and close within three years of opening. Large corporate restaurant chains generally succeed better, and it is the sole trader that is particularly likely to face problems. Instead of experimenting with new recipes for beef bourguignon or duck a l’orange, the small restaurant owner is likely to spend much of their time on more mundane matters. Filling out the VAT return, recruiting staff, calculating their income tax and paying their National Insurance contributions, keeping abreast of new legislation concerning minimum wage levels, maternity leave, and disabil¬ity discrimination are all distractions from the kitchen. Then there is the never-ending task of promoting the restaurant. Many restaurateurs think that customers will beat a path to their door, but diners can be fickle, and, as soon as a new restaurant opens in town, they may be off to try it out.

With so much to do in simply running the business, it is not surprising that many small restaurateurs become disillusioned and move on. Some fail simply because they haven’t developed a realistic business plan. Many of these could have benefited by belonging to a franchise organization, rather than going it alone. In franchised systems, the franchiser typically provides valuable support for administrative and promotional matters, leaving the franchisee to develop their business. Within the restaurant sector, franchising has been relatively slow to take hold at the gourmet end of the market, where the owner’s individuality and style can add to the appeal of a restaurant. But in the convenience food sector, franchising has become popular and allows dedicated individuals to build a secure and profitable business.

The Domino’s Pizza Group has used the energy of talented and hard-working indi¬viduals to deliver good financial rewards to its franchisees. Although the company’s pizzas may not appeal greatly to people who love fine food, its approach to the franchising of food outlets generally offers much more security and profitability than going it alone. In 2004, Domino’s reported that ten of its 100-plus UK and Ireland franchisees owned businesses that were worth more than £1,000,000 each. These figures are based on a standard calculation of twice annual turnover. With an average start-up cost of £183,000 this is a significant return on franchisees’ initial investment. How many sole traders running their own restaurant could match this? In 2002, Domino’s franchisees earned around £120,000 a year on average (although some considerably more), which was more than three times the average income of a typical business manager (£38,1071). Further¬more, no Domino’s franchise failed during the year, compared with over 22,000 business failures elsewhere in the UK economy.

Domino’s research into the skills set and characteristics of the most successful fran¬chisees, both in the UK and internationally, has found that the majority of franchisees believed the traditional corporate management career path failed to offer either the scope to succeed or adequate financial rewards.

Typical of the hard-working individuals attracted to a Domino’s franchise was James Swift. As a 16-year-old delivery driver for Domino’s Pizza, Swift spotted the potential to run his own business at an early age. He soon secured a position as the manager of the Domino’s branch in Swindon. This operational experience was critical for learning everything from how to make a pizza to how to manage a big team. It was about three years later that he got the chance to buy a share in the franchise. By the age of 24, he had become co-franchisee of three Domino’s outlets in Swindon, Newbury and Bath. He put his success down to sheer hard work and determination, with the backing of a well-known brand and the commitment that only the owner of a business can give.

Maybe one day, James Swift will match the success of Richard P. Mueller, Jnr, Domino’s Pizza’s most successful global franchisee. Mueller joined Domino’s in 1967 as a delivery driver and became a franchisee in 1970. By 2003, he owned 158 stores in the USA and employed over 3,000 team members. His company sold over ten million pizzas a year, as many as the entire UK Domino’s business. That equated to five million pounds of do

Scotland on Sunday:
The recession has sparked a surge in the number of Scottish entrepreneurs turning to franchising as a way of setting up their own business, according to figures from the British Franchise Association (BFA).
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