the biggest challenge facing the growth of new franchises is: A) market saturation B) competition from independent entrepreneurs C) the lack of capital D) the recent downturn in the economy

Question

Marco Dodson

Business

26 March, 10:23

the biggest challenge facing the growth of new franchises is: A) market saturation B) competition from independent entrepreneurs C) the lack of capital D) the recent downturn in the economy

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Answers (1)

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Jamison Ferrell · Answer 1

(A) market saturation

Explanation:

A franchisee starts a new franchise by entering into a franchising agreement with a franchiser to use its brand name and sell its products. The biggest challenge faced by this new franchise is market saturation.

This occurs because the presence of other similar businesses, whether franchises or independently owned businesses in the market, creates lots of competition for the new franchise.