QUICK START ROUTE to ESTABLISH AN

ENTERPRISE

Presented by
Abhishek
Sajid
Gopal
Pooja
Navjot

franchising
franchising

FRANCHISING
A marketing system revolving
around a two - party agreement,
whereby the franchisee conduct
business according to the terms
specified by the franchisor

Franchises offer important

pre-opening support:

Site selection
Design and construction
Financing
Training
Grand-opening program

Pros of franchising
Owning a franchise allows you to go
into business for yourself, but not by
yourself
Certain level of independence
Increases chances of business
success
Established product or service which
may already enjoy widespread
brand-name

CONS OF FRANCHISING
Franchisee is not completely
independent
Restrictions usually include the products
or services which can be offered, pricing
and geographic territory
Initial franchise fee, ongoing royalties
and advertising fees.
Agreement is usually limited for a time

example

ACQUISITION

Definition of 'Acquisition'

A corporate action in which a company

buys most, if not all, of the target
company's ownership stakes in order to
assume control of the target firm
Acquisitions are often made as part of
a company's growth strategy whereby
it is more beneficial to take over an
existing firm's operations and suitable
compared to expanding on its own.

Pros of acquisition
Allows entry into new products
andnew markets
Risks and costs ofnew product
development decrease.
Excessive competition can be
avoided by shut down of capacity.
It overcomes market entry barrier
byacquiringanexisting organization.

CONS OF ACQUISITION
The activitiesof new and old organizations
may be difficult tointegrate.
The acquirer may pay high cost ,
especiallyin cases of hostile take over bids.
The returns from acquisitionsmay not be
attractive.
This may create problem of managing
resources andcompetencies.
Too muchmanagerialfocus on
acquisitionscan causes harm to internal
development.

Reasons for acquisition

Desire to relocate to different place in
the country
Wants to start a business in different
sectors
Wants to sell the business to generate
funds
Competitors products are superior
Business is not profitable
Key employees are been leaving

ancillarisation

Meaning
An industrial unit which is engaged or
is proposed to be engaged in the
manufacture or production of parts,
components, sub- assemblies
renders or proposes to supply or
render not less than 5o percent of its
production or services
investment in fixed assets does not
exceed Rs 100 lacs

overview
Ancillarisation and Sub-contracting in India,
started simultaneously with the Govt.
Setting up enterprises almost in all the
core sectors equipment for Defence/
Railways/ Telecommunications, Heavy
Electricals, Electronic, Chemical, Fertiliser,
Petroleum/ Petrochemicals, Ship & Aircraft
manufacturing and various other
engineering and processing industries

classification
Mono type - Normally cater to the
requirements of one parent unit only
Oligo type Normally cater to the
needs of a no of parent units
Indirect operation - Conducting
supplies through the organization,
often operating as commission agent
or dealers

Pros of ancillaration

Minimum setup cost

Low level of inventory
Economical sourcing
Better quality standard
Development of entrepreneurial skills

Cons of ancillarisation
Dependence on parent company
Multiplicity of suppliers by parent
company
Delay in receiving payments
Need time to bring changes in
technologies, method as needed by
parent company

Thank

you