Franchise Business Quiz

What is one advantage of starting a new business?

• High risk involved

• Freedom to choose location

• Longer gestation period

• Difficulty in getting finance

Franchisees are positioned between which two types of entrepreneurs?

• Solo entrepreneurs and corporate entrepreneurs

• Small business owners and large business owners

• Independent contractors and employees

• Innovators and imitators

What is one primary advantage of a franchise?

• Limited profit potential

• Proven methods of doing business

• Complete freedom to try new ideas

• High start-up cost

What is a disadvantage of being a franchisee?

• High risk involved

• Ongoing support from franchisors

• Established brand reputation

• Assistance in pre-start-up stage

What can franchisees benefit from due to collective purchasing power?

• High entry costs

• Cost competitiveness

• Limited operational flexibility

• Higher profit margins

What is a characteristic of an existing franchise available on resale?

• High risk and uncertainty

• Assurance that a business is up and running

• Limited customer base

• Lack of established procedures

Which of the following is a source of information for franchise opportunities?

• Personal blogs

• Trade directories

• Social media influencers

• Television advertisements

What is one disadvantage of purchasing an existing franchise?

• Established customer base

• Possibility of inheriting problems

• Certainty of cash flows

• Low risk of failure

Which trade journal is focused on franchise opportunities?

• Inc.

• Forbes

• Time

• Business Week

Which of the following is NOT an advantage of starting a new business?

• Freedom to try ideas

• High start-up costs

• Greater scope in business

• Low risk of doing business