American Corporations: Franchising Practices

Rudolf Ivanovich Zimenkov
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Rudolf Ivanovich Zimenkov: Institute of U.S. and Canadian Studies of the Russian Academy of Sciences, Moscow, Russia

Russian Foreign Economic Journal, 2022, issue 8, 70-82

Abstract: The article analyzes the practices of franchising used by corporations as one of the leading ways of doing business today. Franchising refers to a business arrangement where one company (franchisor) allows another company (franchisee) to use its well-known brand names, trademark, production, and marketing technologies for doing business for a fee [1]. Since the beginning of the 21st century franchising, covering more than 70 different sectors of the world economy, is used in more than 80 foreign countries, while the total annual sales within the franchise system exceeds $1.3 billion. There are about 16.5 thousand franchisors and more than 1.2 million franchisees in the world, according to the International Franchising Association [2]. The United States are still the major player in the field of franchising relations, occupying the leading position by the main indicators of this form of business. In 2022, franchising activities were mainly concentrated in such areas as catering, primarily fast-food restaurants, home and health services, and fitness-related services. It should also be noted that American corporations have expanded such business activities not only in the United States, but also in foreign markets of Europe, Asia and America, contributing to the development of non-equity forms of capital exports [3]. The American administration, unlike several foreign states, did not disregard this type of activity of domestic corporations, regulating franchising activities contributing to improving the competitiveness of US dollar.

Keywords: franchising; types of franchising; the evolution of franchising in the US; the contribution of franchising to the US economy; legislative framework for franchising (search for similar items in EconPapers)
Date: 2022
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Persistent link: https://EconPapers.repec.org/RePEc:alq:rufejo:rfej_2022_08_70-82

DOI: 10.24412/2072-8042-2022-8-70-82

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