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Value-Creating Franchises and Licenses

Professor Dennis Gayle UCC Executive Chancellor

When a franchisee or licensee decides to agree upon a new venture with a franchisor or licensor, such an agreement is driven by an assessment that the input involved in putting the franchisor’s or licensor’s intellectual property and brand to work in a new environment will create significant new value.
An analogy might be the purchase of seeds to be carefully planted in fertile, correctly sloped land, with sufficient sunlight, to be watered and protected from marauding insects, until maturity.
But what are the prerequisites for success, from the perspective of an intending franchisor or licensor? Could an institution be too small for the purposes of an international franchise? Actually, once such an institution is able to reap economies of scale and scope, accompanied by an established brand, the factors that determine success include committed, visionary leadership, and sufficient funds to prepare for, and marke…

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