Chapter 14- CCT
When entering a new industry through the purchase of a franchise, a small business owner should...
1. examine the industry 2. examine the potential competitors 3. examine the position relative to other new franchises
A franchisor makes money by what
1. selling franchise 2. collecting a percentage of sales 3. providing a specific training
Benefits of purchasing a franchise include...
1. the right to open a branch in a given area 2. the right to use franchisors names 3. the right to operate within the guidelines of the franchise agreement
Individuals looking to buy a franchise should
identify a franchisor that is the best potential match in support of history expansion plans
Franchisor
parent company who sells the right of the name
A franchise contains clauses
requiring purchase of supplies & displaying of marketing materials
the purchase of a well- honed thoughtfully positioned franchise can be dramatically decreased
the RISK in a starting business
Which of the following is a reason for popularity for franchising?
the franchisor can offer standard well known products that are produced by a consistent and well tested process
Franchisee
a person who buys the right to sell the product
Which of the following is a basic contract generated by the franchisor for all franchisees?
Franchise Agreement
