1. Entrepreneurship 8th edition
Author: Robert D Hisrich, Micheal P. Peters Dean a Shepherd

2. Chapter 14 Entrepreneur Accessing Resources for Growth from External Sources

3. Using external parties to help grow a business
Franchising
Joint ventures
Acquisition
Mergers

4. Shah Rukh Roll no: 22

5. Franchising
An arrangement whereby a franchisor gives exclusive rights of local distribution to a franchise in return for payments of royalties and conformance to standardize operating procedures

6. Advantages of franchising to the franchisee:-
Continue….
Advantages of franchising to the franchisee:-
Product Acceptance:
Management Expertise
Capital Requirements
Knowledge of the market
Operating the structural controls

7. Advantages of franchising to the franchiser:-
Continue….
Advantages of franchising to the franchiser:-
Expansion Risk
Cost advantages

8. Disadvantages of franchising :-
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Disadvantages of franchising :-
Inability of franchisor to provide services, advertising etc.
The franchise may face a problem when franchisor bought out by another company

9. Continue…. Types of Franchises :- There are 3 types…. Dealership
Offers name, image and methods of doing business
Offer services

10. Investing in a Franchise :-
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Investing in a Franchise :-
There are factors that must be assessed by the entrepreneur when he/she want to invest,

11. Continue…. continue :- Proven vs Unproven Franchise.
Financial stability of a franchise.
Potential market for the new franchise.
Profit potential for a new franchise.

12. Muhammad Aatif Aneeq Roll no: 15

13. Joint Ventures Two or more companies forming a new company.
It is a separate entity that involves a partnership between two or more active participants.
Strategic alliances
Universities, Non profit organization, businesses and the public.
General Motors & Toyota
General Electric & Westinghouse.

14. Types of Joint Ventures
Private-sector companies
Boeing, Mitsubishi, Fuji, Kawasaki.
Cooperative research
Triangle Park in North Carolina..
Industry-university agreements
Two problems
International joint ventures

15. Factors of Success How to best manage entity Ensuing relationships
Degree of symmetry b/w partners
Expectation of results
Timing must be right

16. Acquisitions Purchasing all or part of a company. Advantages
Established business
Location
Established market structure
Cost
Existing employees
More opportunity to be creative

17. Acquisitions Disadvantages Marginal success record
Overconfidence in ability
Key employee loss
Over evaluated

18. Synergy “The whole is greater than the sum of its parts”
Lack = acquisition failure

19. Muhammad Wasif Laeeq Roll no: 1

20. Mergers Department of Justice How does it take place? Requirements
Determining value

22. Leveraged Buyouts Definition Why buy? Financing Steps before buying
Debt-to-equity ratio
Steps before buying
Is asking price reasonable?
Assess firm’s debt capacity
Develop appropriate financial package

23. Overcoming Constraints by Negotiating
Two tasks
Distribution task
Divide up the pie
Integration task
Make the pie larger

24. Negotiating What will you do if no agreement is reached?
Reservation Price
What will the other party do if no agreement is reached?
Bargaining zone

25. Negotiating
What are underlying issues for you? How important is each issue?
Trade-offs
What are underlying issues for other party? How important is each issue?
Understanding=Increased integration

26. Negotiating Strategy Build Trust and Share Information
Best outcome
Can it hurt the negotiations?
Ask Lots of Questions
Probe for preferences
Make Multiple Offer Simultaneously
Show what’s important based on choices
Used to Create Trade-offs that Result in Mutually Beneficial Outcomes