1.5.4 Franchising

Question 1

Franchise

Answer 1

Where a small business buys the rights to sell the goods and services of a large, well-established company

Question 2

Franchisor

Answer 2

This is the large business who is selling the rights e.g mcdonalds, subway

Question 3

what do Franchisors allow

Answer 3

Franchisors allows a another business , “the franchisee” , to use its business ideas and methods in return for a variety of fees

Question 4

What type of fees does the franchisor receive/the franchisee has to pay

Answer 4

• initial start up fee
• % of sales
• Cost of supplies
• management services e.g services

Question 5

Types of services a franchisor provides (mindmap, notes)

Answer 5

• gives franchisee a licence to produce a product/service that already has a record of success
• provides a recognised brand, which may already have loyal customers.
• provides a start up package e.g help ,advice, training