STRENGTHS AND WEAKNESSES OF FRANCHISING WITH EMPHASIS ON BOSNIA AND HERZEGOVINA

Abstract

The subject of the research is to analyze the advantages and disadvantages of a franchise business with a particular emphasis on the development of the franchise in Bosnia and Herzegovina. The main goals of this paper are to identify the main obstacles in the development of the franchise in Bosnia and Herzegovina and recommendation of measures to improve this business model to take advantage of its great features. Franchising is a business model that is in most cases based on a win-win relationship between the franchisor and the franchisee. Because of this, franchise is a chance for permanent development of participants in franchising. The paper shows that the franchise is extremely popular and developed way of doing business in developing countries. This is reflected in the growing path of revenues, number of employees, number of franchise locations and participation in the GDP of business entities that apply the franchise mode of operation. Applying scientific methods of synthesis, induction and deduction, determined by numerous causes slow down the development of the franchise concept in Bosnia and Herzegovina. Taking into account the above, we can formulate a hypothesis in the following way: Non-stimulating business environment and inadequate knowledge of the franchise are key reasons for the inadequate development of the franchise business in Bosnia and Herzegovina.