Case analysis Study Example | Topics and Well Written Essays - 2750 words

Analysis - Case Study Example Whereas Mary Ellen didn’t see that donating was a disadvantage for the new company to, it needed to expand the profit. While the company experienced a tremendous growth, Mary Ellen could not do everything by herself and when TMT grow to 35 franchisees, Mary Ellen asked her daughter, Melanie, for assistance. Bringing her own experience to the business, Melanie saw a need in introducing formal control into the franchise system. While Mary Ellen was lenient in running a business, franchisees were allowed to pay the royalty payments at a convenient time. However, Melanie felt that TMT brand needed protection of its values and that the royalty rate was low. The decision to raise the royalty rate from 4% to 6% caused conflicts between franchisee, because they were taking advantage of the loopholes in the agreement made by Mary Ellen. Besides, some franchisees threatened to use the name of TMT and its logo without paying for it. They were litigated in the court by Melanie’s request, which resulted Melanie herself serious problem of spending legal costs in excess of $600,000. Despite the complications, the court upheld the TMT franchise agreement, returning two out of six franchisees. The issue with the court gave business owners understanding of the need in better assessing and choosin g of franchisees. Besides, the new level of discernment was brought for the review of prospective franchisees. From being painfully shy, Mary Ellen became the primary PR machine of the business, appearing on CNN and writing articles for the newsletters as for franchisees and employees of the company. Being deeply devoted to the business, she still prefers doing things for the kids, recognizing future customers in them. She also manages to exceed its customers’ expectations value and high standard of satisfaction by arranging meetings on the weekly