Introduction My Friend’s Bookstore was established from a very humble beginning and has continued to thrive since its inception. Its success is owed to the efforts of the three pals who combined their efforts. Perhaps, it would have been difficult for this business to survive if it was operated by a single individual. The three friends were, certainly, able to manage their time very well because other than doing business they were students in the institution where this enterprise was based (My Friend’s Bookstore, 2011). Describe what would happen to the cash position and cash flow of My Friends’ Bookstore if the owners decided to open another store The business entity mentioned above was able even in the presence of its major competitor, and as time moved on, it was able to have a bigger market share than the college bookstore. They did this by subsidizing their rates, and since this bookstore is operated by students who probably reside on the college premises, they can remain operational even after official working hours. It means that the three fellows had to sacrifice their free time, and indeed their sacrifices have been paid back. Now that the business is making big returns, if the three guys decided to open another bookstore in a different location, they would have to look for money to fund the establishment of the new branch. Moreover, for the new branch to be operational, they would have to hire a few employees to help them in running it. The major concern here is where the money will come from. They have several options to choose from first one is to use the profit they get from the current enterprise to open another branch. If the profits are not sufficient, they can consider applying for a loan from their bank. One expects these guys to have one common bank account separate from their accounts. Depending on the amount they have in the bank, they can get a loan and repay it using the profits that they get from the current business. It means that the money they will be getting from the current business will be used to repay the loan and maintain the new business until it becomes stable to cater to its expenses. Pakroo (2010) argues that opening another branch has its own risk, but as it said, no achiever has never lost something hence the three guys should not be afraid of losing because in business is the worst enemy in the business world. Is My Friend’s Bookstore a good candidate for Franchising? Explain and defend your answer The business is a good candidate for franchising because it has a stable and feasible business model. This kind of business is compatible with its environment, and these three people are keen observers because they could identify an opportunity right under their noses. It is said that opportunities are around us, but the major challenge is to identify them. This kind of business is like a gold mine in the education sector because the demand for reading materials is so high. The pioneer business is strategically located, and the availability of customers is assured because it’s conveniently situated in the college hence the new business entities, seeking to benefit from its brand should be located somewhere close to a learning institution because that is where reading materials a