Pre-assessment - Franchise Business

What is a franchise?

• A franchise is a business based upon the

  - use of the brand names,

  - promotional logos and

  - trading methods of an existing successful business.

• A franchise is a business which is set up indenpendently.

• A franchise is when a business opens its own branches.

• A franchise is a type of fast food restaurant.

who is a franchisor?

• A person who owns the business and sells the license

• A person who supplies goods to all other businesses.

• A person who buys the license.

• None of the above.

Who is a franchisee?

• A person who owns the business and sells the license

• A person who supplies goods to all other businesses.

• A person who buys the license.

• None of the above.

What is the advantage of running a franchise business for a franchisee?

• Limited competition, low risk, and easy access to financing
• No need for initial investment, guaranteed success, and complete independence
• Flexible working hours, unlimited vacation, and high salary
• Established brand, proven business model, and easy to set up.

What is the disadvantage for a franchisor in a franchise business?

• Decreased revenue and profitability
• Potential damage to brand reputation

• Increased competition and market saturation
• Limited growth opportunities