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Test your basic knowledge |
Franchizing Vocab
Start Test
Study First
Subjects
:
business-skills
,
industries
Instructions:
Answer 36 questions in 15 minutes.
If you are not ready to take this test, you can
study here
.
Match each statement with the correct term.
Don't refresh. All questions and answers are randomly picked and ordered every time you load a test.
This is a study tool. The 3 wrong answers for each question are randomly chosen from answers to other questions. So, you might find at times the answers obvious, but you will see it re-enforces your understanding as you take the test each time.
1. A type of franchise that gives the exclusive rights to open franchisee - operated units within specified areas
Multiple Unit Franchise
Business Premises
UFOC or the Uniform Franchise Offering Circular
Cooperative Advertising Fee
2. Manufacturing concern licenses a dealer to sell its product. Example is an auto dealership.
Distributorship Franchise
Location of franchise
Types of Franchises
business format franchise
3. Protects franchisee from unreasonable demands and bad faith terminations of the franchise by the
Cooperative Advertising Fee
Federal Regulation of Franchises
franchising
Location of franchise
4. The person or company that gets the right from the franchisor to do business under the franchisor's trademark or trade name
product distribution
Types of Franchises
franchisee
trademark
5. This type of franchise includes not only a product - service and trademark - but also the complete method to conduct the business itself - such as the marketing plan and operations manuals
business format franchise
Branding
disclosure statement
Federal Regulation of Franchises
6. The primary source of legal information about a franchise available to prospective / interested franchisees
disclosure statement
Franchise Disclosure Document (FDD)
co-branding or piggybacking
Types of Franchises
7. Franchisor usually initiates litigation
Main source of litigation (law suits) in Franchise trials
Master Franchise
Cooperative Advertising Fee
Franchise Contract
8. Franchisee ordinarily pays an initial fee or lump-sum for the license. Franchisor relies on initial fee for profit. Sometimes franchisee is required to pay a percentage of franchisor's advertisement cost and other expensive.
Types of Franchises
Location of franchise
Multiple Unit Franchise
Payment for the franchise
9. Termination must be 'for cause -' such as the death or disability of the franchisee - insolvency - breach - or failure to meet quotas.
Main source of litigation (law suits) in Franchise trials
royalty
disclosure statement
Franchise Termination
10. One week of training for managers - operating manual - guidelines for accounting audits - ongoing support / assistance
Franchise Start Up Assistance by Franchisors
franchising
Internet Franchise
franchise
11. Requires franchisors to disclose material facts that a prospective franchisee needs to make an informed decision concerning the purchase of a franchise.
royalty
The Franchise Rule of 1978
Franchise Termination
Manufacturing plant
12. A type of franchise company that does not depend upon physical location for delivery of products / services - but a virtual business
Internet Franchise
Location of franchise
Branding
Royalties
13. Also known as the UFOC - or Uniform Franchise Offering Circular - the disclosure document provides information about the franchisor and franchise system
Business Organization
Franchise Disclosure Document (FDD)
Franchise Termination
disclosure statement
14. Franchise franchisor's method of conducting business a franchise where the franchisee simply sells the franchisor's products without using the
co-branding or piggybacking
Chain-style Franchise
product distribution
Branding
15. The person or company that grants the franchisee the right to do business under their trademark or trade name
royalty
Branding
product distribution
franchisor
16. The legal - written contract between the franchisor and franchisee which tells each party what each is supposed to do
franchise agreement
Quality Control
Business Premises
Franchise Disclosure Document (FDD)
17. Franchisor transmits to the essential ingredients or formula to make a product.
Business Organization
UFOC or the Uniform Franchise Offering Circular
Manufacturing plant
Multiple Unit Franchise
18. A specific type of franchise that allows individuals and organizations to buy the right to subfranchise within a geographic area
Master Franchise
Manufacturing plant
co-branding or piggybacking
franchisee
19. Distributorship - Chain-style - Manufacturing or processing plant
Types of Franchises
royalty
disclosure statement
Federal Regulation of Franchises
20. Fees paid to a licensor by a licensee based upon the production or sales of a licensed product
Franchise Contract
Types of Franchises
Main source of litigation (law suits) in Franchise trials
Royalties
21. Franchise operates under a franchisor's trade name a is identified as a member of a select group. Certain standards must be met in order to be complete
franchising
disclosure statement
Federal Regulation of Franchises
Chain-style Franchise
22. Franchisor determines the territory to be served
franchisor
The Franchise Rule of 1978
Location of franchise
Good Faith and Fair Dealing
23. The regular payment made by the franchisee to the franchisor - usually based on a percentage of the franchisee's gross sales
Main source of litigation (law suits) in Franchise trials
Business Organization
royalty
Branding
24. If a court perceives that a franchisor has aribitrarily or unfairly terminated a franchise - the franchisee will be provided with a remedy for wrongful termination.
Distributorship Franchise
Internet Franchise
Good Faith and Fair Dealing
product distribution
25. A format for the disclosure document which provides information about the franchisor and franchise system to the prospective franchisee
Chain-style Franchise
UFOC or the Uniform Franchise Offering Circular
Location of franchise
Franchise Contract
26. May specify whether the premises for the business must be leased or purchased outright. Sometimes - a building must be constructed to meet the terms of the agreement.
co-branding or piggybacking
Business Premises
product distribution
Cooperative Advertising Fee
27. Franchisee's business organization is of great concern to the franchisor. Franchisor may require that the business have a particular form and capital structure. May also provide standards of operation in terms of sales quotas - quality - and record k
Main source of litigation (law suits) in Franchise trials
Business Organization
Franchise Termination
Franchise Disclosure Document (FDD)
28. Two franchises share location and resources
Federal Regulation of Franchises
Multiple Unit Franchise
Business Organization
co-branding or piggybacking
29. A method of business expansion characterized by a trademark license - payment of fees - and significant assistance and/or control
Franchise Start Up Assistance by Franchisors
franchising
Branding
Chain-style Franchise
30. Specifies the terms and conditions of the franchise and spells out the rights and duties of the franchisor and franchisee - includes agreement on royalties - who settles disputes
State Protection for Franchisees
Internet Franchise
Franchise Contract
Multiple Unit Franchise
31. A license that describes the relationship between the franchisor and franchisee including use of trademarks - fees - support and control
Internet Franchise
franchise
State Protection for Franchisees
Franchise Disclosure Document (FDD)
32. The franchisor's identifying marks - brand name and logo that are licensed to the franchisee
franchisor
franchising
Cooperative Advertising Fee
trademark
33. Agreement may provide for some degree of supervision and control by the franchisor so that it can protect the name and reputation. Certain standards for the facility and will be permitted to make periodic inspections to ensure certain standards for t
Franchise Start Up Assistance by Franchisors
franchise
franchising
Quality Control
34. Marketing technique making a product or service known by it's name or symbol
Branding
Federal Regulation of Franchises
co-branding or piggybacking
Royalties
35. 15 states have laws similar to federal rules requiring franchisors to provide presale disclosures to prospective franchisees
Branding
State Protection for Franchisees
Main source of litigation (law suits) in Franchise trials
franchising
36. A fee paid by franchisees to contribute to a shared advertising fund - separate from royalty fees
Franchise Termination
Cooperative Advertising Fee
Royalties
co-branding or piggybacking