Which characteristic is not considered a positive of franchising? Degree of control and importance of channel members. A. C) Franchisees is the principal governing mechanism of the franchisor-franchisee relationship. The most significant advantage for a franchisee is the increased probability of success. Which of the following is not a key question a prospective buyer needs to ask in buying a business? f(t)=t+2t2f(t)=\frac{t+2}{t^2} b. B) Not required One downside for franchisors participating in franchise channels is: Which of the following are resources that an entrepreneur can typically use to find a business for sale? disagreements between the two parties have increased and contract disputes are causing many lawsuits. Which one of the following is not one of the required factors for successful leadership? He wants the business to succeed. market value. How many years will she have to repay the loan? Chapter 4 Franchises and Buyouts Assessment Flashcards B) Contractual obligations D. Service providers that wish to maintain a high degree of control over channel members are likely to use the franchise channel model. E) Not be counted on, A) Provide a significant advantage for your business start-up, All of the following are advantages of franchising except ________. A) Established multiple franchises All franchisees operating under single-unit franchises own and operate one unit. c. b. The reason franchises have been a popular form of business is due to ___________. (Check all that apply.) Which one of the following is not part of a franchise business arrangement? D) Doing Internet research There are six major organizational development tasks required of a franchisor to develop from a single unit firm into a growing franchise system. There are approximately ___ businesses in the United States. it may be purchased at a bargain price. franchisor supplies brand names, techniques, or other services instead of a complete product. Which major question in his business plan does this statement address? Find all vertical and horizontal asymptotes of the graph of the given function. goodwill The majority of small businesses are managed by, Hamilton has wanted to start a business of his own since he was a small child. c. B) Research a, b, and c only. can learn about the franchise from the ground up. a. Pewterschmidt Company values its inventory reported in the financial statements in terms These are questions directly associated with which phase of marketing strategy for a franchise system? she will work very hard putting in long hours about six days a week, The SBA assists small-business owners entering the world markets by doing all of the following except, offering long term loans to US business owners. WebA franchising strategy whereby a single franchise owns more than one unit in a given area is typically referred to as an area developer strategy T/F. How is buying an existing business not like purchasing a franchise? (pg 134) according to Brian Hendricks, what are the 5 "p's" of entrepreneurship. The costs of franchises vary significantly. High-tech ___ entrepreneurship is exploding. b. A) Fees and costs the franchise 7-eleven Inc. D) All of the above are types of franchising. a. According to the U.S. Census, ( ) are the fastest growing segment of small business ownership today. E. Is a government tax to register the franchise. Which of the following ratios would be ranked the best? B) They are always surprise inspections. d. d. Actions by franchisors to void the contracts of franchisees in order to sell the franchise to someone else and collect an additional fee. Bringing two or more franchise brands together within a single enterprise. The exercise of reasonable care in the evaluation of a business opportunity. B. The attitude of the customer is made up of three key factors. Entitles the franchisee the right to open a business in a given area. Sylvia has an SBA-guaranteed business loan for the average life of such loans. Potential franchisees should evaluate franchisors' operations based __________. B) Eases the issues of start-up development inventory Often, strategic initiatives fail because: They are seen as extra work to be accomplished in addition to existing work. b. TRY: data analyses. Marketing strategy. Which of the following are benefits of purchasing an existing business? f(t)=t2t+2. a. The implementation of marketing mix variables in franchise channels is less fluid and flexible than in conventional channels. An ongoing entity often has a higher purchase price due to __________. Hobby Uniform Franchise Offering Circular (UFOC) Perhaps the greatest advantage of buying a franchise, as compared to starting a new business or buying an existing one, is that the franchisor will usually provide both training and guidance to the franchisee. d. The elimination of time and effort associated with starting a company is an advantage of acquiring an ongoing venture. a. This demonstrates which advantage of a small business? Prior job d. Up-front capital requirements There is one thing every franchise system knows. d. Sales records are of very little value to a buyer in evaluating a company's worth. Which of the following is not a disadvantage of a major franchise? Which of the following types of financial ratios measures the ability of the franchise organization to turn sales into profits? Offer new products/services in new territories to new customers, One who owns and operates more than one franchise unit is known as a, NOT: Area Developer The person who gets the franchise is usually required to do all of the following except: Repeat the test using the critical value approach. Which practice is a competitive concern for franchisees? c. NOT: sufficient time to integrate the brands MAYBE: natural synergy between the brands. c. What is the first step to good site selection? d. C. Nature of product and number of channel members E. None of the above. NOT: prospective franchises being recruited into the system. Which of the following best describes the industry she operates in? This is an example o. Craig has $60,000 to invest in a new small business. C) Uniformity a. T/F, Franchising is a two-party legal agreement whereby a franchisor is granted the privilege to conduct business as an individual owner according to the methods and terms specified by the franchisee. D. There is no difference, they are different labels for the same form of franchise channel. Selling a franchise to the franchisee The most significant advantage of a franchise is the increased probability of ________, given that franchise brands have positive track records and instant recognition in most communities. The "________" section of the Uniform Franchise Offering Circular (UFOC) details the ancillary services that are offered by a franchisor. B. Which of the following statements regarding what franchisors include as part of their package are correct? You stop by a Carl's Jr. fast food restaurant and notice that they also have Green Burrito Mexican food. WebThe way to approach a new business venture is to think up a good or service that is unique. b. old-new Entrepreneurs tend to work harder and take moderately greater risks than persons working as employees in someone else's firm. a. For Jerry's Automobile Parts Fabricating business to qualify as a small business, it can employ no more than ___ people. Regarding the issue of control of franchisees by franchisors, which of the following is most accurate? The potential value of any The initial franchisee vetting usually includes _________. The advantages of franchising include: C) Operations A major reason for success of franchising is Identify which generic category fits most franchise systems below. Marilyn argues that the SBA's primary function is to lend money. a. WebWhich of the following is an advantage to purchasing a franchise?. a. d. c. the owner's family stability and relationships. Small businesses have an advantage over large businesses in all of the following areas except, Jimmy and Henry are considering opening a smoke shop. E) All of the above, The term "FDD" stands for which of the following? Terry's is a. Characteristics of a small business would include all of the following except. He works many hours from January through April but in May takes a month-long vacation and the rest of the year works part-time. The ability to leave the venture if an entrepreneur does not enjoy the business is severely limited. b. a. There are several ways to protect a trademark, as indicated below. Entitle the franchisee to use the franchise's name. c. 5-age. Which of the following is an intangible asset? Franchising is based on a system that the franchisor has already set upand it works. Thus, franchisees must comply with both the franchise agreement and the franchise operations manual to achieve a comparable level of performance. Moreover, these materials safeguard the whole franchise. Identify the unique aspects to purchasing an existing business. economic efficiency? Which is not a start-up expense? should I have right of first-refusal on site selection? Which of the following is not an element of a tort? Traits that entrepreneurs tend to have include all but which one of the following? Is a specialized broker who handles all arrangements for closing a buyout, The purchase price of a business is determined by the negotiation between. the franchisor a. Franchises are governed by ________ laws and regulations. E. All of the above statements are accurate. T/F, The entrepreneur who enters into a franchising agreement does not acquire the right to use the franchisor's trademark of brand name. Which of the following activities at the franchised unit should be the center of attention? d. True or false: Individual thinking they were buying franchise that gave them an opportunity for success found that they had paid for what amounted to little more than a name. B) Positive relationships with their franchisees The difference between single-unit and multi-unit franchises is: Hobby explanation: Franchisees often report the following advantages: management training and support; brand-name appeal; standardized quality of goods and services; national advertising programs; financial assistance; proven products and business formats; centralized buying power; site selection and territorial protection; a greater chance for success. As it pertains to the scope and importance of franchising, which of the following statements is most accurate? a. WebQuestion: All of the following are reasons a franchisor may wish to maintain some degree of control and supervision over the franchisee, except to protect the franchise's name and It is structured between single-unit and multi-unit franchises. D) Capacity to secure franchisees The _________ is the entrepreneur who buys the franchise from the ________. The "Trademarks" section of the UFOC details ___________. new competition may reduce market share. D) Both A and B D) Unable C. Generally, franchise marketing channels are more closely knit (i.e., closer relationships) than conventional channels. C. Training. 9 The franchisor's responsibilities include providing Sales tax. NOT: dealing with financial issues such as accounting and finances. Franchising and franchise channels continue to grow dramatically E) All of the above, Products and services in a franchise may not be altered, added, or dropped without ________. WebProbably the earliest example of franchising in the United States is most likely to be: McCormick Harvesting Machine Company. One of the special focus areas of the SBA is to, assist minorities wanting to start or expand small businesses, A business seeking a loan through the Small Business Administration will actually be given a loan through. d. b. b. all of the above. d. A franchise system can be used for handling SCORE is a group of retired businesspeople who volunteer their services to small business through the SBA.

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