MICRO FRANCHISING AS A TOOL FOR INCREASING SELF-EMPLOYMENT AND COMPETITIVENESS: CROATIAN EXAMPLES

Abstract

Franchising has been present in the global economy in its current format for more than a hundred years. Companies have used franchising for growing their business and geographical expansion by bridging the distance in partnership with local entrepreneurs. Micro franchising provides a proven business model and a chance for self-employment by exploiting all advantages of franchising on a far smaller scale than traditional franchising. This model also helps potential entrepreneurs with low income to cross certain barriers, establish a sustainable business and create opportunities for new employment with the mentorship of the franchisor. With micro franchising, franchise systems could open locations where franchising in the traditional format would (could) not work and by doing so it could expand their business and gain competitiveness on the market, while at the same time enhancing employment and the development of entrepreneurship.

This paper examines the micro-franchising situation in Croatia and checks if this model of growing business can help in increasing competitiveness of a company and at the same time enhance self-employment. Due to their pioneer work in the field of micro franchising in Croatia, Body Creator and Surf’n’Fries were chosen as practical examples.

Keywords: Franchising, micro franchising, self-employment, competitiveness, Croatia