S3 Revision - Understanding Businesses

A franchiser is??

• The business that is paid to allow people to use their name and to sell their goods or services.

• The person that pays a business to use their name.

• The customer of a business buying a product or service

• The business that develops a product or service & only sells it themselves.

What is the franchisee??

• An employee who works in the franchise

• The person that pays the business to use their brand name and sell their products or services

• The business that allows their brand name, products and services to be used

• The customer who buys products or services

A franchise is a very flexible pathway to having your own business???

• True

• False

The franchisee gets to keep all the profits.

• True

• False

The franchisor controls many aspects of the businesses including (more than 1 correct answer).

• Products sold

• Selling price

• Layout of premises

• Hair colour of staff

An advantage for the franchiser is (more than 1 correct answer)??

• Allows the business to expand with less investment

• Risks are shared between franchiser and franchisee

• The quality of the goods/services provided may not be good

• The franchiser gets all profits

The franchisee has to do all their own marketing and advertising.

• True

• False

When starting a franchise the franchisee must.....

• Pick out furniture for their new business

• Provide the franchiser with an initial investment

• Decide what products they will sell

• Decide on a name for their business franchise

The franchiser will provide what to its franchisees (More than 1 correct answer)?

• Advice

• Training

• Advertising

• Flexibility

The franchisee has to pay an agreed share of the profits to the franchiser, is this an?

• Advantage

• Disadvantage