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Thread: Who runs what? In-house, Contracted Out, Franchised

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    Steve F Guest

    Default Who runs what? In-house, Contracted Out, Franchised

    In another thread someone suggested Butlins were only running a few core things and had allowed other companies to run things on site. I wonder if anyone knows the details of who runs what?

    I am intrigued because seeing other names on site doesn't necessarily mean someone else is running it and, of course, the Butlins brand doesn't mean someone else isn't running it.

    As an example, Burger King is normally a franchise business so Burger King UK (or whatever the franchiser in the UK is called) don't generally run the restaurants - they sell franchises to those who do. So in the case of the one at Butlins Skegness there are two real possibilities:

    1. Butlins is the franchisee, i.e. they run the burger joint using the Burger Kind brand and business process and pay Burger KIng a royalty.
    2. A third company runs it, possibly a local franchisee of Burger King and pays Butlins for the privilege (as well as the Royalty to Burger King).

    There are advantages to both approaches. Using a third company as the franchisee would mean Butlins did not need to find the upfront cost to set up and would lower their risk should the outlet not be a success. On the other hand it would mean the outlet was a genuine competitor to the other restaurants on site because the franchisee would make more profit if they attract people to eat at Burger King compared to one of those other restaurants. If Butlins are the franchisee it doesn't matter if you eat there or anywhere else on site they still get your money and they can set the prices so their profit is the same either way so they have effectively eliminated any competition. I would also suggest that with a captive market and food probably being a core part of their business there is less risk in being the franchisee here than is typical.

    The supermarket was also mentioned and I suspect Spar/Everydays are also a franchise and likewise Costcutter which seems to be the new Supermarket at Skegness - the name is not above the door but a Nisa/Todays's delivery lorry was on site and the Heritage brand name is usually found in Costcutters.

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