Choice of Franchises Considering Multicriteral Decision and Risk-Cost Assessment

Abstract

This paper proposes a model for the selection of the most attractive franchises by an alleged franchisee. To do so, using the structure that contemplates the main factors of choice of franchises developed by Silveira (2016), two techniques were used to technically subsidize what would be the most indicated franchise to be chosen: (i) The multicriteria decision method MAUT (Multi-Attribute Utility Theory), and (ii) The Monte Carlo method. Six-segment franchises were investigated in Porto Alegre, Brazil: (i) Children's language school; (ii) Convenience store for gas stations; (iii) Oil change at gas stations; (iv) Real estate; (v) Clock and optics; and (vi) Health, beauty and well-being. At the end, the convergent and divergent results of both tools were compared and a brief analysis was made of the advantage of using the Monte Carlo method on the use of MAUT.