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To: Business development director

From: External consultant

Date: June 20X4

Subject: Joint venture

These briefing notes will assess the impact of the joint venture on the PVS brand and the extent to which PVS's service features would be delivered. A recommendation will also be made as to whether a franchise agreement would be better than a joint venture.

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To: BD Director

From: External consultant for PVS

Date: June 20X4

Subject: Joint venture or franchise

Thank you for the information surrounding the joint venture proposal, please see below my points surrounding this and whether franchising will be a more effective alternative

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Briefing notes

To: Board of directors

From: External consultant

Date: 02/05/2025

This briefing notes will assess the the impact of the joint venture on the PVS brand and the extent to which PVS’s service features would be delivered. It will also recommend whether franchise agreement would be better than a joint venture.

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Impact on brand

This potential joint venture could positively impact the brand. This is because Best4Pets (B4P) is the largest of Arland's two pet stores and having a collaboration with them would allow PVS to tap into their increasing market share. This would allow PVS to grow their brand name and tap into more potential customer which would be good for PVS' financials as they have been struggling.

One way this join venture could negatively impact the brand is through their quality of service. PVS is a brand has a customer base that is built up on expecting quality service, whereas B4P are not as focused on quality service and more focus on low cost strategy wit a very basic level of customer service. As a result of this joint venture some customers, new and old may be under the impression that PVS has compromised on their great level of customer service and quality which they are known for, which could negatively impact the reputation of the brand.

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PVS is know for its differentiation within the vet industry with a reputation for the quality of client service and patient care. A joint venture B4P could probably have a negative impact on PVS branding and reputation. Although B4P is the largest pet superstores in Arland, it only provides low cost product and cost only a basic level of customer service. Clients may react badly as we already know people are willing to spend more on their pets products to love longer.

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The joint venture will collaborate with one of the leading pets stores in the market, Best4Pets.

This superstore is popular for its low costs and availability for customers.

One of the impacts on PVS brand if the joint venture is to be chosen is the potential for a dilution of the customer service provided. The cheaper prices mean the store provide basic customer service.

PVS are not known for their low prices and have been suffering with their customer service scores as of late.

Partnering with this brand may negatively impact the brand of PVS as their customer service levels are likely to drop and the customer bases visiting the stores are likely to be put off by the premium prices that PVS charge.

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Another impact to consider with the joint venture is the locations of the stores.

This should be seen as a positive for PVS, they have been successful in the past due to the location of their clinics and having access to more locations (outside of town centres) will provide them with more reach to gain more customers and brand awareness.

This however, could be achieved with franchising as well so the joint venture is not exclusively the only option when exploring more locations.

In conclusion, being more available in more locations will likely benefit PVS whether it is through joint venture or franchising.

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Location

B4P is located in a prime location that many of their customer are attracted to as it has extensive car parking available as well good transport links allowing them to avoid the rising congestion in town centres. This is a great asset for PVS to try and target in the joint venture as a prime location means more customers entering the locations, which in turn will allow for greater growth of revenue. Better transport link also means that people are more likely to choose that clinic as it will be a lot easier to get to than a very busy area which is a lot harder to get to.

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Innovation:

PVS have been known for their innovation when it comes to new services in the industry and this is what has helped them be successful in their past.

In recent years, they haven't been innovative which is part of the reason for their decline.

Being the first Veterinary service in the sector to partner with a pet store will create a very positive image for PVS. It will show growth and confidence that they are still being innovative in the market which customers are likely to get on board with.

PVS need to increase their market share as they are decreasing rapidly with the growing market and this collaboration could help them achieve their leading status.

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PVS B4P two largest superstores are located outside own centres. As we already know e location is a key for clients who are looking for cleaning which they can travel easily in case of emergency – to minimise transportation time for their pets or to purchases items for their pets. It is good that B4P has extensive car parking available, the good public transport links allowing them to avoid the rising traffic congestion in town centres; this would probably not be convenient for clients to always travel outside town centre to access the stores.

PVS needs to consider that people are more conscious about environment therefore want to drive less, having a store outside town centre could make PVS look like it is not willing to reduce environment impact by having stores outside town centre.

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Quality of service:

As mentioned in the brand impact section the quality of service for PVS has been decreasing as of late.

Part of their service features is quality of service as historically they had an excellent reputation for client service and patient care.

PVS achieved awards for their service features.

Partnering with a budget pet store that have basic customer service levels is not going to improve this service feature which has been dropping in recent years.

Furthermore, B4P are very results driven and not so much on internal satisfaction like the HRD of PVS is leaning more towards. There could be a conflict of interest here as B4P are more focused on profit making and the HRD of PVS is looking for more satisfaction which may create issues.

Also, PVS have been improving with their internal staff scores as of late and this could decline if they are leaning more towards B4P goals.

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Franchises

Franchises are a great way of growing a business and making sure that the brand of a business is very known in a lot of different locations. It will allow for more revenue streams from multiple different stores. One problem with franchising is that the quality sometimes can't be controlled. The quality of service will be hard to replicate at every store which as result will decrease customer satisfaction and create a negative image of the brand. It will cause inconsistencies where some stores will be deemed as good and others as not. If there was a franchise agreement then PVS would not have control over quality of service which is pivotal to their service features.

As a result a franchise agreement would not be better than a joint venture as there would be no control over the quality of service which PVS prides themselves on. A joint venture would give them equal control in which they would be able to impact decisions and control certain aspects of the business that are very important to them such as their key service features.

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Although historically PVS developed and introduced an innovative range of pet care services, there has been very little innovation in recent years and in the past two years there have not been any new service offerings.

To maintain is position within in the industry PVS will have to invest in new technology.

Its marketing activities have been limited to posters in clinics and advertisements in local newspapers; digital marketing – online platforms technology to connect with clients and to gain visibility.

The young generation are actively on social media, to target this market PVS will need to invest in advance technology.

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Innovation

PVS' competitive advantage in the market place consists of their innovation. The idea for the joint venture is one of the most innovate ideas in the industry as it has not been done before. It would be the first of its kind which would not only be beneficial for PVS but also for B4P. This could revolutionise the industry and essentially create a one-stop shop for all your pet needs as B4P would sell the products and the joint venture with PVS would provide the clinic services for pets all in one great prime location. This innovation will get more attention on both companies and will attract more investors as well as please current investors by showing that the company is innovating and trying to grow the company.

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Franchising is a much cheaper alternative to joint venture as they are able to charge management fees to the stores/clinics and likely will have an agreement in place to have a cut of the profits.

However, the control is lost here and the owner of the franchise may have a different vision to PVS which could damage their reputation for example which is part of their service features.

In conclusion after reviewing all the information provided.

I think that the more financially rewarding option will be the franchising, there is less risk involved and can create more opportunities for brand growth.