Question

What are the chief disctinctions among franchises, cooperatives, and nonprofits? Refer to your completed summary chart.

Solution

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Answered 2 years ago
Answered 2 years ago

The main distinctions\text{\underline{distinctions}} among franchises, cooperatives, and nonprofits are:

  1. Motive behind establishing an organization\text{\underline{Motive behind establishing an organization}}
  • profit\textbf{profit} in case of franchises

  • cost reduction\textbf{cost reduction} in case of cooperatives

  • helping people, encouraging art or culture, achieving common goals\textbf{helping people, encouraging art or culture, achieving common goals} in case of non-profit organizations

  1. Funding\text{\underline{Funding}}
  • private investment based on own capital or debt\textbf{private investment based on own capital or debt} in case of franchises

  • withdrawable share capital provided by members\textbf{withdrawable share capital provided by members} in case of cooperatives

  • donations, grants or membership fees\textbf{donations, grants or membership fees} in case of non-profit organizations

  1. Structure\text{\underline{Structure}}
  • Franchisee runs a business\textbf{Franchisee runs a business} under conditions determined by agreement with franchiser

  • cooperatives are democratically managed\textbf{democratically managed} in a way that members share equal voting rights depending on the amount of capital they have put into organization

  • depends on type of organization, but all do have a government character\textbf{but all do have a government character} when talking about non-profit organizations

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