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. c. The __________ is the principal governing mechanism for both the franchisor and franchisee. c. If you don't know how you want to be positioned in the marketplace, and don't know the value propositions you uphold, then you will be: positioned in the market-place and educated on that position by your competition. c. Which of the following processes involves interpreting a relationship between two financial figures? C. In a franchise, parties are independent. The "Federal Trade Commission" does not provide information on franchise success. d. both of the above. b. planning, persistence, patience, people, profit (pg 136) what are the 3 c. Evaluating franchise opportunities include finding out more about which of the following? Stuart has $50,000 to start a new business. franchiser Which one of the following is NOT an advantage of franchising for the franchisee? A. Which one below fits the description of----goods or services that are frequently purchased, usually are low-to- competitively priced, and staples, emergency or impulse buys. 5-age. d. A) Guarantees brand recognition c. A) Training People who own shares of stock in a corporation are the owners of the corporation, The antitrust legislation law that bans false advertising is the, in a partnership, any losses the business incurs will be shared by all the partners. d. Which of the following organizations would most likely give her the help she needs? A ________ specializes in selling buinesses. This is a ___ business. He states in the plan, "This business will serve over 400 customers by the end of the year and employ ten full-time employees." B. Which of the following ratios would be ranked the best? One of the more interesting ratios for franchising is the Location Selection Ratio or Sales/Costs ratio. A primary consideration for a potential franchisee is that the capital required to become a franchisee will likely be: about the same or potential more for starting a franchise business compared to starting an independent business in the same field. Continuing royalty fees 3 reasons for buying an existing business. Short-term obligations created by the franchisee in buying supplies, materials or services associated with running the business are referred to as: Often considered the most critical financial component of working capital is, NOT: accounts receivable This includes all of the following except: Regulations that protect consumers include trademarks, zoning, regulations, and consumer protection laws. One wants to make sure they are not buying into a fad but a viable long-term business. What environmental impact did European practices of land management have in Australia and New Zealand? Product and trade-name franchising is the licensing of the product or the production of the product and the use of the trademark, logo, or other identity of the franchise. c. A franchise system can be used for handling all of these are reasons it could be beneficial. f(t)=t+2t2f(t)=\frac{t+2}{t^2} a. a. It is a channel used exclusively for distribution of consumer durable goods. d. The category most franchise systems are in is the one that has focus on product or service qualities or characteristics with prices being a second-level or a lower order concern to the purchaser. all of the above, Coming up with a unique good or service is a _____approach, while adapting something that is currently on the market or extending the offering to an area where it is not presently available is a(n) _____approach. a. c. The accounting records of a company are kept separate from its owners. The franchisor cannot require the individual franchisee to adhere to a(n) ________. have the ability to quickly adapt to change. The local Small Business Administration Office A) Franchise Disclosure Document Name the three steps used to allocate producing department activity cost pools using the ABC approach. minority He feels that the franchisor is hurting his business by forcing him to buy higher priced products from high-priced suppliers. Which of the following are areas that the potential franchisee may be able to negotiate with the franchisor? Business Brokers help entrepreneurs locate the funds necessary to start a business. Maria has purchased a Subway franchise. A) The franchisor The most important area to examine prior to purchasing a business is company profitability. There are six major organizational development tasks required of a franchisor to develop from a single unit firm into a growing franchise system. d. T/F, One benefit of becoming a franchisee is sharing a profits with the franchisor. How old is the business? b. a. franchisor In franchising, the _____ is the firm that originates the idea for a business and develops the operational methods. According to the SBA, in 2012 women were 51 percent of the U.S. population, and owned at least ___ percent of all small businesses. A. An existing business has an established cash flow. In what way is a franchise's control over the business greatly reduced? C. Lodging. E) Employees, A franchisor's record of success can ________. D) Initial inventory Do you think this was a popular tax? old-new the competition in the area. A franchise is a legal agreement. D) Federal Disclosure Document amount to the government independent of his or her Samantha would like to get a small business loan from the SBA. Which is not a start-up expense? SCORE is a group of retired businesspeople who volunteer their services to small business through the SBA. new-new the franchise. all of the above. What advantage of a small business does Bill enjoy? B. Which of the following organizations can assist him? d. A) Product and trade-name franchising & H_{\mathrm{a}}: \sigma_1^2>\sigma_2^2 inventory d. b. proven track record. Which one below is not one of these tried-and-true approaches for growth? B. saleable value. About how much work should she expect to do to make the franchisee successful? Why would a franchise system monitor its external environment? symbols and logos. old-new The reason franchises have been a popular form of business is due to ___________. B) Termination of the franchise Many franchisors require potential franchisees to work for an established franchisee for a period of time because they _________. a. What is the primary purpose of information systems in a start-up franchise? Importance of channel members and nature of product a. What is the key to convincing someone to purchase your franchise, product, or service? a. D. The challenges managing a franchise channel are fundamentally the same as those encountered in conventional channels. d. About how much time does it typically take in the United States to establish a business as a legal entity? old-old. D) The community Which of the following are resources that an entrepreneur can typically use to find a business for sale? c. The number of jobs provided by franchised businesses is slightly less than those provided by durable goods manufacturing. Why might it be a good idea for a franchisor to investigate several ASP vendors before choosing one? C) Inclusive franchising b. Franchisors sometimes act like a business partner. D. Is based on a percentage of the franchisee's gross sales. If a franchise system is struggling, not achieving long-term success. Which of the following would not be a good reason to start a small business? Several years ago the British government imposed a When purchasing an existing business, the prospective owner should conduct an assessment of the current group of employees. Opening a franchise business has a great deal in common with _________. c. B) Brand recognition firms that have complex internal systems to execute, that draw from a limited pool of qualified employees, or require significant amounts for training to assure franchisee competence in delivery of the system's products or services. a. d. c. It is not uncommon for a buyer to be faced with a franchise fee of 250,000 to 1,000,000. As it pertains to the scope and importance of franchising, which of the following statements is most accurate? WebStudy with Quizlet and memorize flashcards containing terms like All of the following are a new type of franchising opportunity except, Any costing saving resulting from franchises new-old The most common form of business ownership in the United States is the corporatio. A franchisee that has inconsistent quality or service not only hurts his or her own business but also impacts the brand images of all the other franchisees. B) Advertising and promotion An ongoing entity often has a higher purchase price due to __________. C) Penalty if employees are leaving, will enough remain to operate the business. TRY: data analyses. Supplies Portica knows the customers of her hat shop by name and knows each of their preferences. Which of the following is often referred to as the franchisee's "bible"? franchisee. E) All of the above, Which of the following aspects would the franchisor control in a business-format franchising situation? It has an established cash flow. Companies that invest in small businesses. There are four generic categories to classify goods and services. Which of the following activities at the franchised unit should be the center of attention? buying a new business b. new-new, old-old How long has a franchisor been in the business? Mary's Models is a successful model airplane store. the sales package is used by the franchisor to give a prospective franchisee a good sales presentation; the sales playbook helps the salesperson sell to customers. A ____ is a system of distribution that enables a supplier to arrange for a dealer to handle a specific product or service under certain mutually agreed upon condtions. B) Marketing The potential value of any Uniqueness in a product or service can be demonstrated through a new-new approach or a new-old approach. Two parties are brought together by a facilitator, a document called the ______ is the accepted format for satisfying franchise disclosure requirements. design a logo for the unit. Why do most franchisees choose to go into business with a franchised company? The 2014 Annual Report for Murphy Oil Corporation (see www.murphyoilcorp.com) shows the following numbers of barrels of crude oil produced per day in the United States annually from 2008 through 2014: Develop a bar chart that illustrates these data. c. In product distribution franchises: Franchisors capitalizing or financing their businesses are generally required to disclose three key financial statements. B. D) Promotional support identify a franchisor that is the best potential match for him or her in terms of support, expansion plans, and so on. green products d. B) They are always surprise inspections. How many years will she have to repay the loan? What is a realistic number for a sample size when doing market research? WebThe Federal Trade Commission monitors all of the following activities except the sale of unhealthful foods The Franchise Disclosure Document helps the franchise buyer to make They meet with a business planner who helps them compile a business plan. The International Franchise Association is ________. A) Internet franchises B) Conversion franchises C) Co-branding franchises D) Piggybacking franchises E) Leapfrogging franchises E) Leapfrogging franchises Any cost saving resulting from opening product inventory. franchisor. Selling supplies to the franchisee Considering the processes of management for a the franchise system, overall planning of the firm for today's operations and the future of the system itself is the primary responsibility of, NOT: franchisees All of these are ways a franchisor makes money; Most franchisors have a ________ page where potential franchisee can contact them for more information. D) Unity Franchising offers all the following benefits for franchisers except. Identify an accurate statement about buying an existing business. you. The costs of franchises vary significantly. True or false: A poorly performing or disruptive franchisee detracts from the overall operations as well as taking time and effort of the franchisor away from the business of growing the brand. A CPA B. B) Research d. d. Jeremy has written a business plan for the business he would like to open. "When sales continue to grow but are increasing at a decreasing rate" is associated with which stage of the product life cycle? A leading apparel manufacturing firm in the United States invites applications to establish franchises in Texas. D. There is no difference, they are different labels for the same form of franchise channel. Juan has been awarded a franchise in an industry in which the franchisor has licensed him to sell and distribute its product to retailers. b. An agreement not to compete is also known as Much franchise litigation has arisen over termination of owners. machinery. b. B. All of the above. E. All of the above. b. Though a location manual or policy may be developed to assist in determining optimal sites, for franchised businesses that require a store-front location the final determination often rests with: Which two concepts receive primary consideration when determining store layout? Which of the following is not an element of a tort? D. In a franchise, one party grants a license to another party to sell a trademarked product or service. A. How does Auntie Anne's ensure that new franchisees understand the company's operational approach? b. the owner's reason for selling. My salary has remained the same for the past 7 years, but my standard of living has fallen. C. Potential to reduce distribution costs Which technique is not valid for valuing a company? The acutal cost of "opening the doors" of a franchise establishment can be as high as $200,000. new competition may reduce market share. E) Not be counted on, A) Provide a significant advantage for your business start-up, All of the following are advantages of franchising except ________. Many fees are must be paid regardless of ________. Add appropriate labels. When one designs a unique good or service, the individual is said to have used a(n) ____approach to starting the business. Regarding the issue of control of franchisees by franchisors, which of the following is most accurate? brand-name appeal. franchises have a very high success rate compared to other small businesses. E) All of the above, The FDD includes information such as ________. A franchisor's revenue from royalties and selling supplies provide _________ income than that earned from initial franchise fees. She heard about a business model in which an individual or organization grants a license to another to operate an individually owned business as though it were part of a chain of outlets or stores. a. Increased management flexibility he/she is very straightforward about his/her interest, availability, and financial resources. Entitles the franchisee the right to open a business in a given area. new-old, old-new, Starting a business by adapting something already on the market is called what approach? B) Be a concern for a franchisee D) In military bases A franchisor pays a fee to obtain a franchise. B) Failure The franchisor says it has the power to control which suppliers the franchisees use due to implied powers in the franchise agreement. What amount is generally considered adequate? Brenda has a small grocery store in a residential neighborhood where she primarily sells staples to the people who live in the area. E. None of the above. a. The franchisee is bound by the terms the franchise contract. b. B. b. E) Type of product. invest money in the operation. 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 WebAll of the following are a new type of franchising opportunity except ________. Which type of franchisor manual is specifically focused to this purpose? to determine the success of the franchise in meeting its overall objectives. Which of the following laws requires lenders to inform consumers about all costs of credit before an agreement is signed? This is the most common form of franchise channel structure. b. the market. liquidation pricing, "Piggybacking" one's way into business involves using a ____approach. The business franchise model is always an appropriate model to ensure a high degree of control, regardless of the industry. It is most likely that, it may take several years for this business to begin to show a profit, Barrack opens a bagel shop and at the end of each day has five dozen bagels left over that he cannot sell the next day due to health code restrictions. asset pricing. the franchisor Traits that entrepreneurs tend to have include all but which one of the following? He has read about the success rates of franchises and the success rates of start-up businesses. WebWhich of the following is an advantage to purchasing a franchise?. A potential franchisor is concerned that the franchisees will destroy the reputation of the company and end up hurting his business. T/F, Conducting a thorough due diligence should always be accomplished if purchasing an existing corporation or franchise, but is unnecessary if acquiring a sole proprietorship. Marilyn argues that the SBA's primary function is to lend money. health care a. E) Local publicity campaigns. d. 3- Customers already know you exist. An advantage associated with franchising is Which practice is a competitive concern for franchisees? Business services. Franchisees may pay a fee that is separate from the royalty fee, often called a ________, to contribute to a shared advertising fund. track record of the other franchisees as proof of success A. Franchisors provide significant operational assistance to franchisees. There is a higher likelihood of success. What are they? d. d. a waiver of competition clause. D. Limited independence of the franchisee. These are questions directly associated with which phase of marketing strategy for a franchise system? In the United States, ___ account(s) for 97.5 percent of all identified exporters and produce(s) 31 percent of export value. C. The franchisor provides little beyond a license to use its trademarked products. old-old a. c. Which one of the following is Not a common method of borrowing funds in the short-term when considering the rate of interest to be paid: To fund a franchise business, most franchisee use: In financial planning with the franchised business, the most basic and essential variable of the financial planning tools is the: All of the current assets of the firm, or more specifically, current assets minus current liabilities equals: Estimation of sales and other income for a period and cash disbursements to be paid in the same period identifies the components of the: What is the primary purpose of information systems in a large franchise? A) Success A. franchiser. Independence and a desire to determine one's own destiny are some of the entrepreneurs' personal factors in small-business success, others include: Jennifer would like to open her own business. The action plan covers 3 primary areas: the owner, the finances, and other vital factors. the exact status of the franchisor's intellectual property, such as logos, symbols, and words. a great source for quickly locating franchise businesses in many different industries. loss of freedom and control as franchise system grows. The difference between single-unit and multi-unit franchises is: Is usually a one-time flat fee paid by franchisees to franchisors. Which of the following is not a disadvantage of a major franchise? NOT: prospective franchises being recruited into the system. a. he can ensure that the new stores are operated according to his own standards through the franchise agreement. Decide whether the following statement makes sense or not Explain your reason. C) Operations The _________ is the entrepreneur who buys the franchise from the ________. One downside for franchisors participating in franchise channels is: Which of the following is NOT one of the four P's of selling? Leticia would like to start a business and has investigated starting her own or buying a franchise. The "Trademarks" section of the UFOC details ___________. Changes in zoning which affect the business. T/F, The entrepreneur who enters into a franchising agreement does not acquire the right to use the franchisor's trademark of brand name. 23 The franchisor's responsibilities include providing a. Which of the following is not an ongoing cost of franchises? c. Chance, What is an often overlooked asset when acquiring a new business? Joyce worked for a large printing company for two years then quit to take a job at a small sole proprietorship printing company. The "________" section of the Uniform Franchise Offering Circular (UFOC) details the ancillary services that are offered by a franchisor. 40%, Which franchise is not included in the top ten franchises? Which one of the following statements is true? Small businesses have an advantage over large businesses in all of the following areas except, Jimmy and Henry are considering opening a smoke shop. Which of the following is not included in a partnership agreement? b. b. Property, plant, and equipment is recorded at cost (minus any accumulated depreciation) Automobile dealerships and ___ were the primary uses for franchises in the early days of franchise agreements. to generate data which can be used to accumulate working knowledge. Communications between franchisors and franchisees is one-way, performance data that flows from the franchisee to the franchisor. Richard orders some Harley-Davidson Trikes for his inventory. (Check all that apply.) of dollars instead of units. b. a. c. Advertising c. According to Jim Peterson, it is important to know how customers honestly perceive the quality of the product or service offered by the franchise system. must be provided to the potential franchisee early in the process. d. journal, general ledger, financial statements. Which of the following best describes the industry she operates in? All of the following are true about small business except. services. lower Which of the following could he use to protect his interests?. Meeting with every member of the current staff. E. Number of manufacturers in the industry. The advantages of franchising include: Part of the motivation for a franchisor to develop a franchise system is to ensure consistency throughout the business units in the system. legal and professional fees The inventory should be examined for which of the following? C. Franchise fee. A franchisor typically provides _______ to develop performance management programs, quality controls methods, forecasting, and purchasing of equipment, which are very valuable services that act as guidelines rather than mandates in deciding on a franchise. This company could also be referred to a. Samantha would like to own her own business but doesn't want to start it from scratch. insurance c. The "Restrictions on What the Franchisee May Sell" section of the UFOC describes ____________. The franchisor provides a system for the franchisee to operate the business. Franchisors must have a high-quality support a. B. The potential buyer Why would a person choose to buy a franchise? A dealer who distributes product from a product line supplied by a franchisor is considered to be engaged in: A number of major questions should be addressed by a potential franchisor before choosing to expand through franchising. Which of the following agencies will most likely arbitrate this dispute? The Uniform Franchise Offering Circular _______. awareness of some of the unfilled promises from franchisors, Which of the following costs do not add to the cost of franchising? Which of the following helps to simplify the difficult site selection process? d. The product quality is within the perception of the customer and is greatly influenced by the franchise system's server. E. The details of franchise management are vague enabling franchisees to adapt to changing environmental conditions. Macy because the SBA's primary financial function is to guarantee loans. D. Uniform Code of Justice (UCJ) quality of the competition. All of the following are a new type of franchising opportunity except ________. B) Calling on existing franchisees goodwill. determines the salaries of the corporation's officers. E) An act of God, In relation to franchising advantages, you purchase the use of the company's logo, trademark, and advertising, as well as the physical design, layout, and dcor that ensure ________. Potential franchisees should examine the franchisor's package and balance the cost and the _________ being offered. The term "upside gain and downside loss" refers to the profits the business can make and the losses it can suffer. Pay for all physical assets (e.g., equipment and building), needed to operate the franchise. c. d. B) Designated suppliers a. 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. reduced concern over future operations. a. c. Business format franchises are prevalent in which of the following businesses? WebA franchise agreement granting the right to use a widely recognized product or trademark. Will the business's mission and vision change? What type of competition exists? c. The _________ has the responsibility for the business location, of establishing the business, and of building the storefront. c. b. D) Removes the creativity and freedom Is it up to date? d. WebThe Franchisor bills and received payment from the customer directly, and then after deducting its royalties and other fees and payments, sends the Franchisee the balance; If As a class assignment, business students were told to prepare a business plan for a business they would like to own. Generally, the larger and more successful the franchisor, the greater the franchise fee that is charged. About fifteen percent of all marriages in North America fail. Which franchisor manual provided by the franchisor to new franchisees is referred to as "the bible?". Which of the following are benefits of purchasing an existing business? c. D. They are most common among automobile and soft drink channels. Franchisees benefit from continued franchisor research and development of products and processes. Marilyn and Macy are arguing about the primary financial function of the Small Business Administration. Because of disputes between franchisors and franchisees, a program was instituted to arbitrate them. your lawyer. is the principal governing mechanism of the franchisor-franchisee relationship. Franchisors benefit from the franchise agreement because they have. C) Years of experience d. control exercised by the franchisor all of the above, What is the largest source of new business ideas among men? Service providers that wish to maintain a high degree of control over channel members are likely to use the franchise channel model. payment of a fee. collaboration with suppliers through Internet, NOT: franchisors prepaid expenses Firms selling heavy industrial machinery are most likely to use the franchise model to control product distribution. Which of the following are reasons entrepreneurs should conduct their own market research? disagreements between the two parties have increased and contract disputes are causing many lawsuits. Business students at universities can work together to provide management counseling to small businesses in their community. The market research should be independent of the franchisor. The control issues are: 1. A regular and continuous fee paid to the franchisor by the franchisee is called: E. Franchisees provide significant operational assistance to franchisors. Which of the following is an advantage to purchasing a franchise?. c. To properly develop a franchise system the franchisor must develop the franchise system at three different levels. A corporation pays taxes both on its income and on the amount it pays out in dividends, it faces very little government regulation. Franchising and franchise channels continue to grow dramatically. D) Optimism The franchisor licenses its trademarked products to franchisees. As it pertains to the motivation of franchisees, which statement is generally false? Capital advantages equity? WebThe Franchisor provides all the following Except. The _____approach indicates the importance of people's awareness of their daily lives for developing new business ideas. A) Themselves b. NOT: marketing and advertising to customers D) Both A and B In multi-unit franchisees, franchisees receive permission from the franchisor to own and operate more than one unit at the outset of their relationship, whereas single-unit franchises initially only receive permission to operate a single unit. How many personnel are going to remain? Macy argues that its primary function is to guarantee loans. E) All of the above. b. franchatter. It is so successful that she has decided to allow others to use her business name, materials, and methods in operating their own business for a fee. On-site management In exchange for an ownership share, small businesses receive financing from a group of investors known as franchisette. WebProbably the earliest example of franchising in the United States is most likely to be: McCormick Harvesting Machine Company. All can be sidestepped. help out with financial assistance. D) Gender D. Reduce uncertainty 9 E. Quality control standards. a. Anastasia has started a dry cleaning business but is having difficulties with various aspects of organizing and operating the business.
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