Reference no: EM133495454

Question

1. Who is demonstrating due diligence?

Constance, who is applying for a loan

Gordum, who is researching the franchisor's history

Clayre, who is distributing royalties

Jamarie, who is hiring employees for a franchise location

2. Every franchise agreement is flexible to some degree.

True

False

3. Mauri works for a franchise location of a nationally-owned sandwich shop. When it comes to train new employees, she follows training procedures provided to the shop by the parent company. She also benefits from being mentored by a regional trainer who has years of experience with the company. This is an example of which franchise advantage?

marketing expertise

financial assistance

professional guidance

proven product

4. Which is most likely to use the production-distribution franchising model?

branch of a hotel

table service restaurant

automobile oil change location

drive-thru hamburger restaurant

5. Hans owns two different ice cream shop franchise locations in his city. Every year, the city hosts a large festival that overwhelms his resources. He asks his parent company for advice on how to handle this challenge. Even though the parent company always has resources for him, no one has experience dealing with this set of local conditions. Hans feels he has no idea what to do without input from the parent company. This is an example of how ______ may be a challenge for franchisees.

fraud and misunderstandings

franchisee overdependence on the parent company

restrictions of franchisee freedom

limitations on franchisee creativity

6. You're a new business owner of a spa franchise that has locations across the country. Your initial rent costs are reduced through your parent company. You also receive some inventory from the national headquarters. This helps you to get the spa up and running faster than you could have if you had to secure capital for all of your start-up expenses. Which advantage of being a franchisee does this demonstrate?

recognized standards

proven product

marketing expertise

financial assistance

7. The franchise was originally created as a way to ______.

increase distribution channels

increase control over product quality

decrease employees needed

decrease the number of managers needed

8. Molli owns a small business that distributes Coca-Cola products. Her company uses the brand name and logo, and no one else in her territory is permitted to distribute this brand. Within her region, if a restaurant would like to sell Coke products, Molli's company will be in charge of the distribution. What type of small business owner is Molli?

product-distribution franchisee

corporation

legacy entrepreneur

business-format franchisee