Read The article and answer the questions and write a conclusion.

1: How can Magnolia Bakery manage the risks of using franchising for expansion?

2:Conclusion

Two decades after Magnolia Bakery became a New York City sensation and helped ignite a national cupcake boom thanks to its role in the hit HBO series Sex and the City, it is branching out.

The purveyor of pastries and other delectables is looking to open as many as 200 franchises across the U.S. over the next five years.

Magnolia Chief Executive Steve Abrams said the company plans to go into about 50 of the top markets in the country, with at least three locations in each. Magnolia hasnt yet set franchise fees or worked out other financial details for potential franchisees, he said.

Magnolia has already been on an expansion drive with its company-owned stores. The bakery, which started in 1996 at a spot in Greenwich Village, has grown to encompass six stores in New York, plus ones in Boston, Chicago and Los Angeles. It also has an international franchising program, with 17 stores spread across seven countries.

Last year, the privately held companys annual revenue was $45 million, company officials said. Mr. Abrams said Magnolia plans to continue opening company-owned stores.

Magnolia could face challenges as it looks to franchise nationally, said experts in the restaurant and franchising world. They note that the cupcake craze is long past its peak, and point to the demise of Crumbs Bake Shop, another prominent cupcake retailer.

Mr. Abrams makes the point that Magnolia has moved well beyond cupcakes in its offerings and has touted its banana pudding of late. He added that cupcakes now account for just a third of the companys sales.

At the same time, he said, cupcakes will always be key to the brands identity, particularly as it establishes itself nationally.

Were still the big name in that category, he said. Thats always going to carry weight.

Magnolias move into franchising comes at a time when other New York-based restaurant chains are expanding in similar fashion. Among those that have recently started franchising programs are Hummus & Pita Co. and Mamouns Falafel.

But perhaps the biggest success story in the last couple of years has been the Halal Guys, the food-cart business-turned-restaurant operator. It now has more than 60 franchise locations across the U.S., with another 350 in development, according to Al Rowe, vice president of Fransmart, the Alexandria, Va., company behind the franchising efforts.