NOT: marketing and advertising to customers C) Encouraged How long has a franchisor been in the business? d. The accountant assigns revenues and expenses to specific years before preparing the financial statements. franchisee the ability to build personal relationships with the owners and other employees. Master franchises do not allow individuals and organizations to buy the right to subfranchise within a delineated geographic territory. C. Potential to reduce distribution costs d. a. d. B) They are always surprise inspections. A ________ specializes in selling buinesses. D) Doing Internet research a. B. Capital advantages b. d. Identify an accurate statement about buying an existing business. c. A) In traditional stand-alone units B) Financing assistance What environmental impact did European practices of land management have in Australia and New Zealand? Many fees are must be paid regardless of ________. b. a financial investment. A franchisee generally receives which of the following when purchasing a business? WebWhat is usually required for a franchisor to terminate a franchise? Franchisors sometimes act like a business partner. B. c. A) Franchisor agreement health care the competition in the area. location of the competition. The franchisor's responsibilities include providing Which of the following statements regarding franchisors' long-term success are true? determines the salaries of the corporation's officers. Often, strategic initiatives fail because: They are seen as extra work to be accomplished in addition to existing work. A franchise system can be used for handling c. c. 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. The most popular SBA course is, a course that surveys eight to ten areas of business management, An organization created by Congress in 1953 to help, counsel, and protect small business is known as the. Chance, What is an often overlooked asset when acquiring a new business? A. Identify which generic category fits most franchise systems below. a. Pewterschmidt Company values its inventory reported in the financial statements in terms The market research should be independent of the franchisor. Franchisees have the option of using the logo and symbols of the franchisor. new-old 7-eleven Inc. All of the following are disadvantages of franchising for the franchisee, except for: typically operate as a non-unionize business establishment. This is higher than _____, the amount the Census Bureau and Federal Reserve say 50 percent of all new businesses begin with.. A(n) ____ is a carefully constructed plan for an individual starting a business. Small businesses have an advantage over large businesses in all of the following areas except, Jimmy and Henry are considering opening a smoke shop. fast and selective distribution of products. c. old-new process for expanding a business or service through licensing arrangement. All of these are ways a franchisor makes money; Will the business's mission and vision change? b. False T or F? liquidation pricing, "Piggybacking" one's way into business involves using a ____approach. After doing routine background checks, the firm permits John to open a branch of the firm in a given area, use the firm's name, and operate a business within the guidelines of an agreement. Which of the following statements is true about franchising? Which of the following is not a key question a prospective buyer needs to ask in buying a business? a. C) Franchisees a. reduced concern over future operations. The franchise's time frame. a. B. The control issues are: 1. d. If you decide to purchase a franchise, you will have to pay. E. Is a government tax to register the franchise. WebAll of the following are a new type of franchising opportunity except ________. What is the effect on economic 3 reasons for buying an existing business. Prior job b. Which of the following types of businesses benefit from being located near competitors? the franchise. One of the main reasons she may have made the move was. of dollars instead of units. What amount is generally considered adequate? WebThe Franchisor provides all the following Except. D. Usage tax. The "Restrictions on What the Franchisee May Sell" section of the UFOC describes ____________. And, how much will it cost to implement? risk versus reward. What is the name of that program? Which of the follow statements about starting a franchise are similar to starting a business from scratch? What exactly is to be done in each segment? Which of the following are ways in which a franchisor earns profits? All of the following are a new type of franchising opportunity except, Any costing saving resulting from franchises purchasing power helps to offset other costs , such as franchise, Start - Up Standard require of franchisees may include which of the following, Products and service in a franchise may not be altered, added, or dropped without, in many instances, products or ingredients in a franchise must be purchased from, As a franchise one will benefits from the purchasing power of the franchisor to get, a provide a significant advantage for a business start-up, all of the following are advantages of franching except, all of the following are selected franchise fee and cost accrording to the text except, Franchisors are to provide operations manuals and training to their franchisees , which are valuable resource for success, Fundamentals of Financial Management, Concise Edition, Daniel F Viele, David H Marshall, Wayne W McManus, Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield. a waiver of competition clause. the financial picture of the business. T/F, There is no need to find out more information about a prospective franchise as the franchisor should be the primary source of information T/F, A 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, The potential value of any franchise arrangement is defined by the rights outlined in the franchise contract. NOT: prospective franchises being recruited into the system. Entitles the franchisee the right to open a business in a given area. Three major reasons that explain why franchisors distribute via franchise channels are: (1) capital advantages, (2) potential to reduce distribution costs, and (3) possible high level of managerial motivation fostered by franchising. Which of the following is a disadvantage for the franchisor? The franchise with the most outlets in the United States is. Buildings 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. B. Royalty agreement Obtain needed training from franchisees The owner may be in trouble with suppliers. A. Why is the owner selling? The Franchise Disclosure Document helps the franchise buyer to make a knowledgeable purchase. A. Macy argues that its primary function is to guarantee loans. The costs of franchises vary significantly. Which of the following things is NOT true about the accounting process? Maria has purchased a Subway franchise. d. c. NOT: customers D) Optimism Richard has a motorcycle and ATV store. ( ) usually provides the starting-point of data collection when conducting marketing research. Which of the following best describes the industry she operates in? Sound franchisors provide a significant quantity and excellent quality of start-up assistance to new franchisees, as well as ongoing education and support for established ones. 1- Reduced risk of failure. management and training. The attitude of the customer is made up of three key factors. Supplier Control. E) Very few franchisors do inspections. a deferential sale of business clause. There is a higher likelihood of success. Franchising and franchise channels continue to grow dramatically. The "Trademarks" section of the UFOC details ___________. E) All of the above, The FDD includes information such as ________. Which of the following are benefits of purchasing an existing business? 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. minority Jimmy John's, Which is not a cost of franchising? The franchisor might negotiate a complete different deal with the franchisee in order to get started with a self-sufficient operator. D) Initial inventory franchise There are few resources for franchise research. new-new it is possible to start a business with limited capital. Franchise agreement usually allow the franchisee to operate the business _________. D) Removes the creativity and freedom What is the name of the business agreement Henry would sign? is the principal governing mechanism of the franchisor-franchisee relationship. C. Nature of product and number of channel members c. Which of the following is true about co-branding? c. Is it up to date? hurt not only the business at their location but also the image of other locations. Sales records are of very little value to a buyer in evaluating a company's worth. b. The owner may be in trouble with suppliers. 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 a. B) Marketing "Pro forma" accounting statements as used in business financial planning means: a statement of anticipated costs and revenues or change in assets, liabilities and equity based upon prior (operating) financial performance. The party granting the license is the. E) Employees, A franchisor's record of success can ________. T/F, A franchise is typically attractive because it offers training, financial assistance, and operating benefits. new-new Which descriptive statement is NOT one of the legal ways of protecting a trademark? success will cause another outlet to be opened nearby. Franchising offers all the following benefits for franchisers except. Companies that invest in small businesses. a. Which of the following types of financial ratios measures how well a franchise meets its short-term debts or financial obligations? Degree of control and importance of channel members. The franchisor provides a system for the franchisee to operate the business. Education courses E) All of the above, Franchisors are ________ to provide operating manuals and training to their franchisees, which are a valuable resource for success. d. The business that represents 99.7 percent of all employers in the United States is a. Which of the following types of financial ratios measures the ability of the franchise organization to turn sales into profits? Godfrey has just graduated from business school and is seeking employment. b. Externally dedicated to the market, yet internally focused on production, seeking to produce high-volume or high-value product/service while carefully examining any new opportunities for costs/benefits in relation to known strengths of the firm, is a description of which one of the market-focused business strategies identified below. limits placed on the franchisee regarding what it can do with the product and its production. What changes will be made? new-new, new-old A. Franchises include the business name and a general plan for business operations. He states in the plan, "This business will serve over 400 customers by the end of the year and employ ten full-time employees." A. C) Years of experience A significant amount of up-front cash is required to begin operations. How does the motivation of franchise channel members differ from the motivation of channel members in conventional channels? B. d. Which of the following statements most accurately describes the success rate of franchises? he/she is very straightforward about his/her interest, availability, and financial resources. 5-age. Which of the following issues should detailed in the "Business Experience" section of the Uniform Franchise Offering Circular (UFOC)? Which of the following could he use to protect his interests?. What is the effect of such a tax on equity? Which philosophy of expansion is, as a rule, the best method for franchisors? franchisee A) Fully understanding the FDD of the franchise company b. What is the primary purpose of information systems in a mid-size franchise? T/F, One benefit of becoming a franchisee is sharing a profits with the franchisor. Chance Ability to achieve a good golf score while making sales to prospective franchisees. Which of the following ratios would be ranked the best? Generally, the larger and more successful the franchisor, the greater the franchise fee that is charged. c. A(n) ___________ is the firm that originates the idea for the business and develops the operations methods. In franchising, the _____ is the firm that originates the idea for a business and develops the operational methods. all of the above. A) Type of franchise The franchisee is bound by the terms the franchise contract. market value. b. a. Which of the following statement most accurately describes a franchise channel? Which of the following is an intangible asset? The primary administrative costs of administering a franchise program typically include those of: hiring and training salespeople to recruit or solicit prospective franchisees, The recruitment package is part of the franchisor's, initial response to a potential franchisee's inquiry for information about the franchise, The written information provided in the franchise package to a prospective franchisee contains, promotions package and operations materials. whichever method the franchisor deems appropriate for a their particular business. The ______ is a firm that originates the idea for a business and develops operational methods to run the business. Is the building heated with gas or electric? franchiser. Dwight has a small business and would like to sell his products overseas. What type of competition exists? Which of the following does Smoothie King founder Stephen Kuhnau credit as the reason for his success? D. Limited independence of the franchisee. Negotiating a deal to acquire exactly what is required from the operation. a. have the ability to quickly adapt to change. Potential franchisees should evaluate franchisors' operations based __________. all of the above. b. In 2016, the International Franchise Association reported that franchises in the United States (US) provided nearly ______ direct jobs. B. Strong franchisors have all of the following except ________. C) Geography A) Provide a significant advantage for your business start-up Payroll C) Territory Automobile dealerships and ___ were the primary uses for franchises in the early days of franchise agreements. 41 Which of the following is an advantage to purchasing a franchise?. B) Brand recognition The start-up and ongoing assistance provided by a franchisor guarantees your success. new-old, old-new, Starting a business by adapting something already on the market is called what approach? What is the primary disadvantage of owning a franchise experienced by a franchisee? The inventory should be examined for which of the following?
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