Buying franchise opportunities and challenges for Vietnamese SMES

Abstract

The worldwide economics is in its great strain especially after the US financial crisis in 2007. With the highest rate of unemployment as well as bankruptcy, it is a serious problem for new enterprise - in particular Small and Medium Enterprises (SMES) - to find an investment opportunity. In Vietnam, franchising is still a new concept. However, it seems to be one of the optimal investments in crisis. It is claimed so because buying franchise offers franchisees much support and advantages from franchisors including existing profitable brand name, modern technique, staff training and even loan recommendations to trusted banks with favorable conditions. These are very valuable for new Vietnamese enterprises - in particular Vietnamese SMES. But is franchising (in this case is buying franchise) completely advantageous? Are there any potential difficulties for Vietnamese SMES when buying foreign franchise? The importance of these questions should not be underestimated. The main purpose of this thesis is analyzing opportunities and challenges for Vietnamese SMES when buying franchise. These findings will support to conclude that whether Vietnamese SMES should buy franchise or not. Hopefully, analyses and recommendations in this thesis could provide Vietnamese SMES with proper understandings in other to build a strategic direction.