QUICK START ROUTE to ESTABLISH AN ENTERPRISE

Presented by – Abhishek Sajid

Gopal Pooja

Navjot

franchising

franchising

FRANCHISING A marketing system revolving around a two -

party agreement, whereby the franchisee conduct business according to the terms specified by the franchisor

Franchises offer important pre-opening support: 

• Site selection • Design and construction • Financing • Training• Grand-opening program

Pros of franchising• Owning a franchise allows you to go into

business for yourself, but not by yourself• Certain level of independence• Increases chances of business success• Established product or service which may

already enjoy widespread brand-name

CONS OF FRANCHISING• Franchisee is not completely independent• Restrictions usually include the products or

services which can be offered, pricing and geographic territory

• Initial franchise fee, ongoing royalties and advertising fees.

• Agreement is usually limited for a time

example

ACQUISITION

Definition of 'Acquisition'

A corporate action in which a company buys most, if not all, of the target company's ownership stakes in order to assume control of the target firm

Acquisitions are often made as part of a company's growth strategy whereby it is more beneficial to take over an existing firm's operations and suitable compared to expanding on its own.

Pros of acquisition• Allows entry into new products and new

markets• Risks and costs of new product development

decrease.• Excessive competition can be avoided by shut

down of capacity.• It overcomes market entry barrier

by acquiring an existing organization.

CONS OF ACQUISITION• The activities of new and old organizations may

be difficult to integrate.• The acquirer may pay high cost , especially in

cases of hostile take over bids.• The returns from acquisitions may not be

attractive.• This may create problem of managing resources

and competencies.• Too much managerial focus on acquisitions can

causes harm to internal development.

Reasons for acquisition• Desire to relocate to different place in the

country• Wants to start a business in different sectors• Wants to sell the business to generate funds• Competitors products are superior • Business is not profitable• Key employees are been leaving

ancillarisation

Meaning • An industrial unit which is engaged or is

proposed to be engaged in the manufacture or production of parts, components, sub- assemblies

• renders or proposes to supply or render not less than 5o percent of its production or services

• investment in fixed assets does not exceed Rs 100 lacs

overview• Ancillarisation and Sub-contracting in India,

started simultaneously with the Govt.• Setting up enterprises almost in all the core

sectors equipment for Defence/ Railways/ Telecommunications, Heavy Electricals, Electronic, Chemical, Fertiliser, Petroleum/ Petrochemicals, Ship & Aircraft manufacturing and various other engineering and processing industries

classification• Mono type - Normally cater to the

requirements of one parent unit only• Oligo type – Normally cater to the needs of a

no of parent units • Indirect operation - Conducting supplies

through the organization, often operating as commission agent or dealers

Pros of ancillaration• Minimum setup cost• Low level of inventory• Economical sourcing• Better quality standard• Development of entrepreneurial skills

Cons of ancillarisation

• Dependence on parent company • Multiplicity of suppliers by parent company• Delay in receiving payments• Need time to bring changes in technologies,

method as needed by parent company

Thank you