Advantages and disadvantages of chain store system?

Institutional advantages of chain operation \x0d\ In the circulation field, chain operation organizes retail outlets with scattered financial management to form enterprises with sufficient scale. Scientific institutional arrangements are conducive to reducing transaction costs, enabling chain enterprises to form long-term trust and cooperation relations with upstream enterprises and downstream customers, and are conducive to the good development of chain enterprises. Different types of chain operation have different institutional arrangements, which reflect their different institutional advantages. \ x0d \ 1。 Institutional advantages of direct chain stores. Including: \x0d\ (1) scale advantage. Under the operation mode of direct chain, the headquarters implements highly unified management for a number of stores belonging to a certain capital, and the headquarters has complete ownership and management rights for each store, including unified management of people, finance, goods, business flow, logistics and information flow. This institutional arrangement is conducive to concentrating efforts, unifying fund allocation, personnel management, business strategy, procurement, planning, advertising and other businesses, and unifying the development and application of the overall cause to cope with the financial department and production department with large capital scale; We can also give full play to the scale advantages of chain operation in cultivating and using talents, developing and popularizing products by using new technologies, and realizing the modernization of information and management. \x0d\ (2) Economic advantages. The concentration of functions reflects the economic advantages of direct chain stores. If you use the headquarters to purchase goods in large quantities, it is easy to develop stable sources of goods and get discounts, thus reducing management costs and operating costs and selling goods at lower prices, which is an advantage that independent retail stores do not have. \x0d\ (3) Technical advantages. Although the number of employees working in retail chain stores is small and not necessarily professional, with the direct guidance and help of the headquarters, chain stores can still achieve the expected results. \ x0d \ 2。 Institutional advantages of franchise chain. The core of franchising is the transfer of franchise rights. By signing franchise contracts with franchisees one by one, the headquarters will not only impart all necessary information, knowledge and technology to franchisees, but also grant franchisees the monopoly right to use store names, trade names, trademarks and service marks in a certain area, and allow them to continue their business after opening the store. Therefore, the institutional advantages of franchising are mainly manifested in its benefits to the operators (franchisees), franchisees and consumers in the chain system. \x0d\ (1) Advantages of franchise chain operation to franchisees: \x0d\ First, franchisees not only save money, but also gain opportunities to expand the market, which can enhance their popularity and accelerate the development of chain operation; \x0d\ Second, when a leader starts a new business, having a partner * * * to share the business risks can greatly reduce the business risks; \x0d\ Thirdly, franchise stores are a stable commodity circulation channel for champions, which is conducive to consolidating and expanding the commodity sales network; \x0d\ Fourth, leaders can adjust the number and layout strategy of franchise stores according to the changes of their own operating conditions, headquarters system and environmental conditions, and grasp the initiative of chain operation; Fifth, unify store design, clerk clothing, commodity display, etc. Franchise stores can form a strong and attractive unified image, which is helpful to the shaping of corporate brands. \x0d\ (2) The benefits of franchising to franchisees: \x0d\ First, inexperienced entrepreneurs can run stores, which can reduce the risk of failure; \x0d\ Second, you can borrow the promotion strategy of the chain headquarters; \x0d\ Third, entrepreneurial activities can be carried out with less capital; \x0d\ Fourthly, it can operate efficiently and expand and develop its business under the guidance of the staff of the head office; \x0d\ Fifth, it can stably sell good quality and low price goods and concentrate on sales activities; \x0d\ Sixth, it can adapt to market changes. \x0d\ (3) Benefits of franchise chain operation to consumers: \x0d\ First, standardized operation enables consumers to enjoy standardized high-quality goods and services in any franchise store; \x0d\ Second, franchisees reduce sales expenses by expanding scale and simplifying links, so that consumers can enjoy inexpensive goods and services. \ x0d \ 3。 Institutional advantages of free chain. Free chain is a joint operation on the basis of retaining the ownership of a single capital. Each branch shall conduct independent accounting, be responsible for its own profits and losses and be self-reliant. The management function of the headquarters to each branch is weak, focusing on the guidance and service function. The advantages of free chain are as follows: \x0d\ (1) flexibility. Under the operation mode of free chain, each branch has greater independence, so it has higher flexibility, which can fully mobilize the enthusiasm of operators, quickly follow the market conditions and make timely and effective adjustments. \x0d\ (2) Learning. Free chain stores have horizontal connections, which are conducive to mutual learning and common development. \x0d\ (3) liquidity. Free chain combines the functions of more than two circulation links, which can realize the "vertical combination" of circulation and play a higher efficiency. For example, free chain can combine the functions of wholesale and retail, and introduce the functions of design and processing, thus increasing the added value of goods. \x0d\ (4) Profitability. Free chain headquarters is composed of franchisees, who can get sustainable profit returns from headquarters profits as strategic investments. \x0d\ Benefit Advantages of Chain Operation \x0d\ The most fundamental reason why chain operation can achieve good economic benefits lies in applying the principle of modern industrial mass production to the retail industry, and realizing the standardization, specialization and unification of commercial activities. This also constitutes an important basis for chain operation to produce economies of scale. On the one hand, advanced marketing technology can be popularized in many stores on a large scale, thus obtaining the benefits of technology; On the other hand, the cost and risk of investment can be shared equally in many stores, thus reducing the cost of goods. \x0d\ The benefits and advantages of chain operation are as follows: \ x0d \ 1. The specialization of business technology development is conducive to the improvement of store management level. \x0d\ chain system has two levels: headquarters and stores. One of the important responsibilities of the headquarters is to study the business skills of enterprises, including the placement of shelves, the display of goods, the design of store capacity and appearance, and the adjustment of business varieties. , directly used to guide the operation of the store, making the store get rid of the experiential operation mode of the traditional retail industry and turn to science for efficiency. The unified management skills developed by chain headquarters can be widely used in various stores, which can generally improve the management level of each store, thus obtaining the benefits of technology (an excess profit compared with other enterprises) and sharing the cost of technology development. This is not something that a single enterprise can do. \ x0d \ 2。 Standardized management is conducive to improving services and expanding sales. \x0d\ Under the mode of commercial chain operation, the development, design and standardization of store equipment, display, products, operation process, technical management and advertising design are all concentrated in the headquarters. The headquarters is responsible for the location selection and pre-opening training of chain stores, providing a complete set of commercial service plans, and constantly supervising, guiding, communicating and training each chain store, so as to ensure the unification of products, services, store names and store contents of each chain store, meet consumers' requirements for standardized products and service quality, and achieve the purpose of attracting customers and expanding sales. Standardized management is of great significance to establish the image of the store. \ x0d \ 3。 The logistics center undertakes part of the wholesale function, so that part of the profits of the wholesale link are transferred from society to enterprises. \x0d\ The profit of retail links depends largely on the number of circulation links through which goods pass. Generally speaking, the fewer circulation links, the lower the cost of commercial circulation, and the more sales profits retail links can obtain. \x0d\ Chain enterprises generally have logistics centers, which are dedicated to distributing goods for stores. Some of these goods are directly purchased from factories, which reduces the circulation links; At the same time, some goods are raw materials or semi-finished products when they are obtained from suppliers, which requires the logistics center to carry out assembly operations such as processing, packaging and sorting, which increases the added value of goods and transfers some profits. \ x0d \ 4。 Centralized operation management is conducive to reducing the operating costs of enterprises. \x0d\ Inter-bank nature of chain operation makes some same-sex activities of each store, such as purchasing, storage and transportation, advertising, accounting, etc., all managed by the headquarters. In this way, many stores * * * enjoy a set of operating facilities and a set of management institutions, and each store does not need to set up complicated management institutions or be equipped with corresponding management personnel. This has two advantages: first, it reduces the overall management cost of the enterprise; Secondly, the reduction of operating costs brought by centralized operation is also obvious. If it is purchased, because there are many shops, it creates many sales conditions, so the headquarters can obtain lower prices from manufacturers through large-scale procurement, that is, wholesale prices. For another example, due to the delivery from the headquarters, each store needs a small inventory area and inventory, which can expand the sales area and reduce the capital occupation. \ x0d \ 5。 Chain operation is conducive to reducing the risk of commercial investment. \x0d\ Chain enterprises operate multiple stores, even if individual stores fail to operate, it will not affect the overall economic benefits, because the losses caused by a certain decision-making mistake can be shared by multiple stores, greatly reducing the risk of commercial investment. For franchisees who buy franchise rights, joining franchise chain stores can make use of a successful business transaction model that has been tested in practice and get the guidance and help of franchisees. Compared with opening a store alone, the probability of success is greatly improved, and the risks faced by newcomers in the industry are greatly reduced. No wonder some people say that franchising is a "safe passage" into the business world. \ x0d \ 6。 Chain operation is conducive to improving the status of retail business, guiding production and organizing marketable goods. \x0d\ chain stores have played an increasingly important role in promoting the production field since their emergence and development. First, chain stores join hands to buy in large quantities, which ensures the production process and reduces the production cost of manufacturers. Second, one end of the chain store is connected with the consumer and the other end is connected with the manufacturer, so that the information of the consumer can be fed back to the manufacturer in a more timely manner and the manufacturer can be guided to produce marketable goods. At the same time, chain stores also provide retail laboratories for manufacturers to test new products quickly and economically in a wide area. Third, the formation of chain stores has increased the total amount of social products. Because the reduction of retail expenses has relatively expanded the purchasing power of consumers, the increase of purchasing power has in turn stimulated the development of production and increased the sales of stores. \x0d\ In addition, the chain operation has many outlets, a wide radiation range and a high market share, which is an important reason for the chain operation to achieve good economic benefits by quickly concentrating funds on a large scale, realizing the flexible transfer of investment and obtaining market opportunities and benefits. \x0d\ Competitive advantage of chain operation \x0d\ Chain operation has solved the contradiction between mass sales and consumers' dispersed demand, and it is a major change of zero praise organization, which is called the third revolution of retail industry. Chain operation improves operating efficiency and realizes economies of scale through the principles of standardization, simplification and specialization, which has incomparable competitive advantages for other retail organizations. The specific performance is: \ x0d \ 1. It is easy to gather capital quickly, which is beneficial to seize fleeting market opportunities. \x0d\ Chain operation mode, especially franchise chain operation mode, can quickly pool many individual capitals and form overall strength. Under the same competitive conditions, we can seize market opportunities in time, invest, purchase goods and develop new products, which will bring good economic benefits and development opportunities to enterprises. \ x0d \ 2。 The degree of organization is high and the market competitiveness is enhanced. \x0d\ Chain operation is a highly organized organizational form integrating production, processing, retail and wholesale in the circulation field. It has few organizational links, sensitive adjustment and quick response; It connects consumers through chain-like sales network and sales channels, which can quickly and accurately understand and master market information, quickly push manufacturers' products to the market, expand market share and enhance market competitiveness. \ x0d \ 3。 Low operating costs. \x0d\ The headquarters of chain operation purchases in a unified way, and the purchase volume is huge, so you can enjoy the price discount and other benefits to the maximum extent. Chain stores generally purchase goods directly from suppliers (manufacturers) without going through wholesalers, which reduces the purchase cost and transportation cost; Due to the unified inventory management of the headquarters and the organizational form of the logistics distribution center, compared with a single store, it can save a lot of storage costs; In advertising, the chain headquarters is responsible for the overall planning, which not only reflects the overall publicity effect, but also saves advertising costs. In addition, the standardization, modular operation and store form of chain operation have improved the efficiency of chain operation management and reduced the management cost. \ x0d \ 4。 Strong product sales ability. \x0d\ Because the goods or services of chain stores have more price advantages than those of other business models, and centralized procurement ensures the quality of goods, they are very attractive to customers. Chain stores are scattered, with convenient transportation and fast delivery; Moreover, a number of scattered chain stores form an orderly service network, which can provide consumers with fast and high-quality pre-sales, mid-sales and after-sales services, with service advantages. All these make chain stores have strong sales ability. \ x0d \ 5。 Achieve economies of scale. The emergence of \x0d\ chain operation has solved the contradiction between large-scale sales and the requirement of individual small and medium-sized retailers to maintain operational independence, so that both chain headquarters and chain stores can enjoy the economic benefits brought by economies of scale, without threatening the independent operation of chain stores. (Note: Chain Operation: Theory, Practice and Cases, edited by Wang Jifang) \x0d\ It is precisely because of the above advantages that chain operation has strong competitiveness and great development prospects, which makes it enduring in the world. \x0d\ Three risks of chain operation \x0d\ Although chain operation has great advantages, it also has certain risks. Chain operation can't be achieved overnight, it's just a mode of operation and organization, and only by combining it with the ability, capital and market environment of operators can it play its greatest role. \x0d\ The possible risks in chain operation are: \x0d\ 1. The overall risk of the chain system \ x0d \ Remember the historical story that Cao Cao chained many ships together? The advantages of ship "chain" are hidden at the same time. When Sun Quan \x0d\ Liu Bei attacked Cao Cao with fire, Cao Cao showed the disadvantages of many ship chains to the fullest. Like chain enterprises, its disadvantages are hidden in its advantages, which is the overall risk of chain system. Even the world's super chain brands can hardly avoid and guard against this overall risk. Since the outbreak of large-scale avian influenza in Asia in 2003, KFC's chicken-oriented Asian chain system has been hit, and it is reported that its annual turnover has dropped by as much as 20%. In 2005, KFC once again encountered the "Sudan Red 1" crisis, but a small hidden danger of seasoning made a huge fast food chain kingdom suffer a heavy blow in the short term. \x0d\ 2。 Risk management and control of the chain system by the headquarters \ x0d \ The whole chain system is the reproduction and amplification of the original stores, and the amplification and output of the management capacity of the headquarters. If the original store and the general department can't do well, most stores in the whole chain system can't do well; If the original store does well, not every store in the whole chain system can do well, but if the original store does well and the headquarters is well managed, most branches in the whole chain system can easily do well. \ x0d \ 3。 Risks brought by changes in market demand. \x0d\ The market is unpredictable, and consumer demand presents a multi-level and diversified trend. Chain operators are facing the increase of uncertain factors and more intense market competition. Chain enterprises sell products or services. When the market does not need a certain product or service, can chain enterprises perceive the change of market demand as soon as possible, so as to cope with the change and ensure the effectiveness of the chain network?