Distribution channels around the world are highly differentiated. However these differences cannot be explained just by culture and income level of the existing market. What is the difference between organic growth and franchising?

What will be an ideal response?

Organic growth occurs when a company uses its resources to open a store on a greenfield site or to acquire one or more existing retail facilities from another company. For example, Marks & Spencer's announced in 1997 plans to expand from one store to four in Germany via the purchase of three stores operated by Cramer and Meerman. Franchising is the appropriate entry strategy when barriers to entry are low yet the market is culturally distant in terms of consumer behavior or retailing structures. It is a contractual relationship between two companies. The parent company-franchisor authorizes a franchise to operate a business development by the franchisor in return for a fee and adherence to franchise-wide policies and practices. The key to a successful franchise operation is the ability to transfer company know-how to new markets. Benetton, IKEA, and other focused, private-label retailers often use franchising as a market entry strategy.