LICEO DE CAGAYAN UNIVERSITY

Rodolfo N. Pelaez Boulevard, Kauswagan

Cagayan de Oro City, Misamis Oriental

FRANCHISING
QUIZ 3

Submitted By:

Charrysah T. Tabaosares

BSBA – FM4

Submitted To:

Mario E. Temporada

Date Submitted:

October 08, 2020

CHAPTER 4: CASE STUDY

Yvonne know that home construction is riding a dramatic trend in hard flooring materials;
hardwood, brick, and tile are back with a vengeance. The area rug market is on fire, and the
established providers cannot handle the flames. Indeed, Oriental rug traders, impersonal
warehouse stores, and wall-to-wall carpet marts leave consumes looking for an alternative.
Yvonne Kelleher started “The Rug Place” in 1987 in Baton Rouge, Louisiana. The rug
place is an exciting, unique rug business opportunity, custom tailored to this rapidly
growing market. Yvonne’s business is customer friendly by design, simple to operate, and
proven in the real world. Best of all, this opportunity has come at the right time, in the right
place; and now Yvonne wants to franchise. They have proven experience, raw buying
power; and top-notch market research. They provide innovative display technology,
software, and thorough training and support to get franchisee going and keep them
growing. The Rug place also keeps it simple: no irritating accounts receivable, no costly
warehousing, and no reinventing the wheel.
The Rug Place is an exciting design studio-style retail environment, stocked with a
great selection of affordably priced area rugs in the latest styles and colors.
Now Yvonne wants to franchise. Does she need an accountant, marketing expert,
and financial advisor? What should she do to set up her organization correctly?

CASE QUESTIONS:

1. How should Yvonne organize her franchise system so that she can sell new
franchises and support the franchisees once opened?

 She should first evaluate her first shop or store and see how it will perform in the
market. She should also evaluate her profits to know if it is possible to open up a
new franchise.
2. What three levels of development should Yvonne accomplish before starting her
franchise program?

 Yvonne should accomplish this following levels of development below:

 Strategic development
 Administrative development
 Operations development

3. What else does Yvonne need to know before franchising?

 Yvonne should know that franchising is not easy as withdrawing money, first thing
she should know if it is feasible or profitable and if she can sustain the franchising
system. She should have a better solution on the bigger risk in which is she is going
to partake.

4. What can Yvonne learn from Jim Peterson that would help her to become a better
franchisor?

 Leadership: Yvonne have a good sense of vision when she can see the trend of the
rug market and seize the opportunity to initial the business. She needs to keep this
sense of vision to be able to see how the franchise business could be in the future to
lead the system overcome the difficulties and develop it.