ECONOMIC INDICATORS OF BUSINESS AND LIVING STANDARDS OF THE POPULATION, AS POTENTIAL FACTORS, FOR FRANCHISE OPERATIONS IN THE SERVICES AND TRADE SECTORS

Abstract

The paper analysed and asseed the basic elements of the economic efficiency of franchises in the field of trade and services in Serbia. The main economic indicators of performance, which include payback period, an accounting rate of return, net present value, profitability level and break-even analysis, are analysed and assessed. External factors that affect the total business, especially the location selection, are analysed through the impact of the standard of living of the population. Calculations and analyses were made based on the data on certain franchises and statistical data on trends in living standards for the cities and regions in the Republic of Serbia.

The number of inhabitants and the standard of living proved to be a factor in business decision making. Business buildings can be reasonably opened in areas with an average population of about 3.33 % of the total population. In regions and cities with a low percentage of population it is justified to open franchises if they are located at high frequency locations such as highway or tourist destinations.

It is very important to emphasize that for management, in addition to all the indicators analysed, it is very important to maintain standards that include a recognizable appearance, a standard quality offer, well-trained staff and everything else that the brand carries with them.