Dream Dinners: Evaluating a Franchise Opportunity - Case Study Example

Comments (0) Cite this document
Summary
What expenses did the pro forma statements conveniently leave out?
When comparing the pro forma projections in Exhibit I to the actual result…
Download full paperFile format: .doc, available for editing
GRAB THE BEST PAPER97.8% of users find it useful
Dream Dinners: Evaluating a Franchise Opportunity
Read TextPreview

Extract of sample
"Dream Dinners: Evaluating a Franchise Opportunity"

Download file to see previous pages But when it comes to Exhibit II there is losses seen in some months and also the end profit is not satisfactory .If we compare two of the exhibits we can see that the Dream Dinners is doing averagely good because their expense is high in some months and the end profit is not fair enough. In the Exhibit one, we can see that the sales is high and even when expenses were increasing there was enough profit. So it can be understood that there is difference in the level of expense and profit when it comes to Dream Dinners business performance is in actual result. The pro forma statement has conveniently left out some expenses like telephone, professional fees and rent
Break-even point in number of sales normally is calculated using the following method. It is by calculating the companys total fixed expenses by the contribution margin ratio. Here the ratio can be calculated using company totals or per unit amounts. We will compute the contribution margin for the company in the following way.
3. Based on Exhibit I prepare a discounted cash flow analysis (NPV). Assume the different scenarios in Exhibit I represents year one through four. Are there any other operating costs that should be considered? Assume a 35% tax rate, depreciation rates as presented in Exhibit II, a cost of equity capital of 20%, and an operating profit valuation multiple of 5. Apply the valuation multiple to the projected cash flow in year four add it to the projected cash flow for year three. Does the venture appear profitable?
Generally, the term NPV stands for Net Present Value, which is a Discounted Cash Flow (DCF) .It is a method used in forecasting the long run desirability of an investment (capital outlay). If the net present value of a prospective business is shown to be a positive number then the investment can be deemed as desirable. However, if it shown to be a negative numbers then the investment seem to be undesirable. The outflow and inflow in a business decides the discounted ...Download file to see next pagesRead More
Cite this document
  • APA
  • MLA
  • CHICAGO
(“Dream Dinners: Evaluating a Franchise Opportunity Case Study”, n.d.)
Retrieved from https://studentshare.org/finance-accounting/1680198-dream-dinners-evaluating-a-franchise-opportunity
(Dream Dinners: Evaluating a Franchise Opportunity Case Study)
https://studentshare.org/finance-accounting/1680198-dream-dinners-evaluating-a-franchise-opportunity.
“Dream Dinners: Evaluating a Franchise Opportunity Case Study”, n.d. https://studentshare.org/finance-accounting/1680198-dream-dinners-evaluating-a-franchise-opportunity.
  • Cited: 0 times
Comments (0)
Click to create a comment or rate a document
CHECK THESE SAMPLES - THEY ALSO FIT YOUR TOPIC
Franchise Business
...in automobile industry like Toyota are operating in almost every part of the world through franchising. Justification of the business In the 20th century, most of the world’s economies followed expansionary paths, with many firms finding a solution to increasing their customer base in operating businesses in foreign countries. During this period, most countries had exponential increase in population growth rates that necessitated accommodating foreign firms in an economy for this would spur employment opportunities (Hammond, 2011). Businesses that are run of franchising rails stand a chance of excelling because the products as well as services brought in the market place have been...
5 Pages(1250 words)Research Paper
Subway Franchise
..., the trainees will be evaluated if they are ready to work for Subway. Those who do not pass the training conducted will either be re-trained or will not be employed. E. Continuous training - Like in any organization, it is important that the training program for the employees be an ongoing program to keep the workers updated on any changes within the organization. Training assures an organization that the employees remain efficient and effective. References Franchise Direct. (2012). Top 100 global franchises ranking. Retrieved August 7, 2012, from franchisedirect.com: http://www.franchisedirect.com/top100globalfranchises/rankings/ Om Sai Ram Center for Financial Management Research....
4 Pages(1000 words)Essay
Franchise vs. Non-Franchise
... of the businesses evaluated: Franchise: Subway Non-franchise: Pizza X Organizations have a number of ways through which they connect with the international world and become a part of it. This has been made easier through a number of factors including a reduction in trade barriers, faster as well as cheaper communication facilities and rapid changes in consumer tastes and preferences. The whole world has countless opportunities, resources, information and customers to make use of. In order to become involved internationally, an organization has a number of options including exporting, global outsourcing, offshoring, licensing and even direct investing. Licensing is when the licensor (corporation) makes certain resources available... to make...
7 Pages(1750 words)Research Paper
Franchise law
...Franchise Law Take Home Exam Joe’s Franchise Renewal In general, a franchise renewal involves the expiration of an existing franchise agreement and the formation of a new franchise agreement. In other words, a renewal operates to replace the expired franchise contract. All state laws refer to the right of refusal to renew or non-renewal parameters with a general understanding that should the parties renew the franchise, it is on very different terms and conditions (Barkoff and Selden). The main issue is usually whether or not the terms and conditions for renewal constitute good faith and fair dealing grounds for refusing...
12 Pages(3000 words)Essay
Wendy's Franchise
...” (www.wendys.com). Thus Wendys is the worlds third largest quick service food chain restaurant compared to the McDonalds with over 31,000 locations and Burger Kings over 12,000 locations. Approximately 77% of Wendy’s restaurants are franchised and Wendy’s mainly operates its business in North America and other major regions including Middle East, Asia and New Zealand and Europe. Wendy’s provides its franchise opportunity to worldwide businesses by fulfilling few steps – research the Wendy’s franchise; submit application; find a best place to locate from the restaurant maps; getting worldwide contact information from regional managers; and getting a capital investment...
5 Pages(1250 words)Essay
Franchise Paper
...of this business opportunity. If it was hard to acquire a loan from an established financial institution, I’d consider approaching a venture capitalist for financial support (Madura, 2009, p.90). It would be much easier to source the funds from the venture capitalist given the potential economic viability of the franchise. If I did not meet the net worth requirement, I would consider liquefying my some of my assets. Archive IT provides a 2-weeks training for the franchisee upon entering the contract. There is also ongoing support through the provision of newsletters, online consultations, and regular field evaluations by the management. The franchise provides co-operate...
2 Pages(500 words)Research Paper
Franchise business and none-franchise business
... Franchise Business and Non-franchise Business A franchise is an arrangement in which the owner of a trademark, trade name or a copyright allows others to use the trade mark, trade name and copyright in the selling of goods and services by way of a license. A non-franchise business on the other hand, is a solo variety type of business, which has up-front costs involved during initiation. Franchise businesses require a greater amount of financial input as well as personnel in order to manage the business (Crawford and ODonnell 20). The franchise business presented in this paper is a real estate brokerage firm by the name Block Real Estate Block Real Estate Brokerage firm interviewed obtains its materials and supplies exclusively... pace of...
6 Pages(1500 words)Essay
Any franchise
...Report of Miami Sports Ventures Youth sports are taking another dimension in the society today. Very many programs and initiatives geared towards changing behavior are coining their ideologies behind the mask of sports. These provide a good avenue for developing a franchise that provides and regularly supplies these projects with the needed sports utilities. With the world cup also coming around the corner, the thought of sports will highly influence many into involving in the activity itself. In order to make Miami a place to enjoy life then sport must be incorporated to change the minds of the young people who have turned to crime. The demographics of young people interested in sports have changed in Miami with more...
2 Pages(500 words)Essay
Subway Franchise
...Subway, a global franchise, presents lucrative opportunities for investment. The franchise has many franchisees anchored by solid entrepreneurial spirit. The company has various franchise options for anyone interested in franchising. The available options encompass satellite locations, non-traditional locations, school lunch program areas, national park locations, airport terminal locations, and community development program locations (Franchise Direct). The franchise has set different franchise fee. The investors in the United States and Canada pay $15,000 as franchise fees (Subway). On...
1 Pages(250 words)Article
Chipotle Franchise
...Chipotle Franchise Marketing Position and Value Analysis The modern markets for food products are more competitive than ever before. Economic times have changed over the past few decades or so compelling restaurants to be more aggressive and innovative in order to survive the tough business environment (Cook 117). Strategic decisions on marketing are important to an organization’s survival because they are related to the long-term plans of the organization in one way or another. In choosing the marketing position, management must ensure that all the factors in the immediate internal and external environment are taken into account. These factors include the direct and indirect competitors, suppliers and the customers....
2 Pages(500 words)Research Paper
sponsored ads
We use cookies to create the best experience for you. Keep on browsing if you are OK with that, or find out how to manage cookies.
Let us find you another Case Study on topic Dream Dinners: Evaluating a Franchise Opportunity for FREE!
logo footer
Contact us:
+16312120006
Contact Us Now
FREE Mobile Apps:
  • StudentShare App Store
  • StudentShare Google play
  • About StudentShare
  • Testimonials
  • FAQ
  • Blog
  • Free Essays
  • New Essays
  • Essays
  • Miscellaneous
  • The Newest Essay Topics
  • Index samples by all dates
Join us:
Contact Us