Summary of PPT Slides

Introduction
(PPT 2, 3, 4)
Think Pizza, Choose Domino's!
Domino’s pizza is a passionate team in pursuit of becoming The Unrivalled No.1 Pizza
Company in Malaysia.
Here is the video about the Domino’s Pizza. The title of the video is Domino’s Pizza
Turnaround. After the video, here is the background of Domino’s Pizza.

Domino’s started with one store, which is called "DomiNick's“. It bought by brothers, Tom and
James Monaghan. By 1989, Domino's had 5,000 stores in operation, making it the fastest-
growing pizza company in the world, with stores in the UK, Japan, and South America.
Domino's is the world's leading pizza delivery company committed to leading the industry in
product quality and operational excellence. In Malaysia, Domino's Pizza was officially launched
by Tom Monaghan, founder of Domino's Pizza Inc, in September 1997.

Q1. What are the advantages and drawbacks of being an employee and a self-employed person?
(a) An employee? (PPT 6, 7, 8)
The definition of being an employee is a person who has been hired and provided services for a
company in return for a payment. There are some advantages of being an employee, the first
advantage is employers have little to no supervision of employees. Second is time table
determined, the timetable is set for you. Besides that, you will also become less stressful. And
also, you will have security of income, which mean full pay, you will get your salary every
month. Furthermore, you will also have day off and holidays paid.
There is also having some drawbacks of being an employee. The first drawback of being an
employee is employers have little to no supervision of the employees. Second is security thread
rises when workers accessed the net from outside. Besides that, you will have financial burden.
And also, health and safety issues while working in the home office. There has been a lot of
controversy over the liability issues of telecommuting.
(b) Self-employed? (PPT 9, 10, 11, 12)
The definition of being a self-employed people is a self-employed person is defined as an
independent worker, they work for themselves instead of working for an employer.
The first advantage of being a self-employed is you can control schedule by your own. You will
also enjoy your work, since you are self-employed. In addition, the overhead costs are low, for
example, set up an office in a room of your house with the materials and equipment you will
need. Also, reduce the commuting costs, you do not leave your home every morning, fight
traffic, and then turn around at the end of the work day. Lastly, it also have potential for higher
income, when you become self-employed, and you are your own boss, the money you earn from
your business may be more than you earned working for a traditional employer.

There are some drawbacks of being a self-employed. First, self-employed people pay more in
taxes; there is no way around it. You are responsible for your income tax. Second, self-employed
people also miss out on paid days off, when you wake up with the flu, you lose out on the
earnings for that day. Also, you will have to pay for your own health insurance. Many would-be
entrepreneurs continue to work for someone else simply because they can’t afford to buy health
insurance and they don’t want to risk debilitating medical bills. Unless your business is a
franchise, you will have little or no name recognition when you start, and you will have to work
hard to build the company’s reputation as you build a customer base. While you can work in
your pajamas when you work from home, you also never leave work. If your business requires
you to leave home, you have to find and pay for the work site, adding a second mortgage or rent
payment to your existing bills. There also have some impact on your lifestyle and family life.
Besides that, when you are the boss, you are also financially responsible for any mistakes you
make and you are also easy become more stressful. Lastly, your business might get fail, if you
are not well in planning the business strategic.
Q2. Discuss the relative merits of direct management and franchising.
(a) Direct management (PPT 14, 15)
The definition of franchiser is that they own the overarching company, trademarks, and products,
but gives the right to the franchisee to run the franchise location, in return for an agreed-
upon fee. And the definition of franchisee is the arrangement by which monopoly producer or
owner gives permission for the exclusive right to manufacture or sell the product in a certain
area. There are some advantages of direct management. The first advantage is the diverse role of
manager. A manager will involve in the front and back of business operations, which including
staffing, accounting and menu planning. The second advantage is people-oriented environment.
The manager must have outgoing personalities. They must listen patiently to customer
complaints and have good interaction with staff at all levels. The third advantage is the
opportunity to promotion. Sometimes the manager may receive the opportunity for increased
responsibilities in exchange for higher pay. The last advantage of direct management is about the
team work. It is required in the organization structure to ensure that customers’ needs are met.

(b) Franchising (PPT 16)

The first advantage of franchising is Branding. Normally the franchisers have already survived
decades in their business, therefore it is easily identified by the public. The second advantage is
the advertising. When you consider buying a franchise, the franchisers will offer the national
campaign, which include in your franchise fees. The third advantage is the name recognition of
the franchise. When the customers stop by your shop, they will know what to expect because the
majorities of them are repeal customers. Furthermore, reputation is also one of the advantages of
franchising. A franchisee enjoys the protected reputation of the franchisers because there are the
legal department that takes care of the inevitable issues, for example, accidents and difficulties
with employees. Lastly, the last advantage is the support from the franchisers. In the head
quarters of franchisees will train you in everything from the technology involved, accounting,
stand behind the counter and taking money.
Q3. Will franchisees always act in the interests of the franchiser? Will franchisers always act in
the interests of franchisees? How can these two sets of problems be overcome?

(a) Will franchisees always act in the interests of the franchiser? (PPT 18, 19)
Yes, the relationship between franchisers and franchisees has often been termed a "commercial
marriage". In many ways this is true, though the difference is that in the franchise relationship
there must by definition be a “senior partner”, which is the franchiser. Also, the franchise
agreement defines the entire basis of the relationship up front, so that both parties know their
rights and obligations to the relationship. Usually, franchisees need to restore individual
entrepreneurship, work for themselves, they need to compete with big business and to provide
entrepreneurs a means to enter business with a low capital investment and risk. Franchiser allows
consumers to buy good quality items and services, and provide an easily recognized and
accepted product or service. Thus, franchiser needs franchisee to enhance their visibility.

(b) Will franchisers always act in the interests of franchisees? (PPT 20)
No, because franchisees are lack of interpersonal relationships and business networks, they also
lack of commercial credit, lack of capital, and they often like an armchair strategist,
entrepreneurial ideas white elephant, market forecast is generally too optimistic.

(c) How can these two sets of problems be overcome? (PPT 21)
If franchisees and franchisers have some problems, they need to have a negotiation, they should
have a discussion or meeting before setting up a business. Conflict can only exist when
franchisers and franchisees are pulling in different directions. When dealing with conflict, find
the common ground between franchisers and franchisees. Furthermore, actively seek a solution,
franchisers seeking to resolve conflict must contemplate the fact that they may not have the best
answer. To be actively seeking a solution means that you are willing to ask your franchisees and
to listen openly to their positions and to their proposed solutions. Lastly, franchisers must listen
to the voice of franchisees. To find common ground and find solutions, franchisers must be able
to sincerely elicit input from franchisees and truly understand their points of view. Franchisers
need to put themselves in franchisees’ positions.
Q4. What other reasons may explain the fact that 15 per cent of Domino’s outlets are managed
directly by the company rather than by franchisees? (PPT 23, 24, 25)

Firstly, there are company still needs a right way to control franchisees. When a company makes
a decision to franchisees, it must first develop a sound plan for expansion. This plan must take
into consideration the numerous issues such as leadership, communication and persuasion, to
name just a few of the most important issues. Larger companies need to address more complex
issues such as channel conflict, anti-trust issues, and resource allocation. Secondly, it is
participation. Company will able to include joint planning and sharing of idea or information and
on-going development strategy. There are literally hundreds of different business issues that
must be addressed in a good franchisees agreement, and the decisions made regarding these
issues will ultimately dictate your success as franchisees. A franchisee participates in the
franchiser’s business to a much higher degree than employee. Companies have to consider
whether the maintenance of secrecy and ascension between senior management in others also an
implicit objectives. Finally is the ownership issue. The company owns the right to the format of
that business. Therefore, franchising is not a good way to increase the net asset value of the
business to be franchised. And franchising allows companies to expand without the risk of debt
or the cost of equity. Since franchisees provide the initial investment at the unit level, franchising
allows for expansion with minimal capital investment on the part of the franchiser. In addition,
since it's the franchisee, and not the franchisor, who signs the lease and commits to various
service contracts, franchising allows for expansion with virtually no contingent liability, thus
greatly reducing a franchiser's risk.
References

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