1. CHAPTER 6
1) DEFINE & EXPLAIN WHAT FRANCHISING IS.
2) EXPLAIN THE 3 MAIN TYPES OF FRANCHISING.
3) WHAT ARE SOME ADVANTAGES TO FRANCHISING?
4) WHAT ARE SOME DRAWBACKS TO BUYING A
FRANCHISE?

2. FRANCHISING
-”SEMI-INDEPENDENT BUSINESS OWNERS (FRANCHISEES) PAY FEES
& ROYALTIES TO A PARENT COMPANY (FRANCHISER) IN RETURN FOR
THE RIGHT TO BECOME IDENTIFIED WITH ITS TRADEMARK, TO SELL
ITS PRODUCTS OR SERVICES, & OFTEN TO USE ITS BUSINESS FORMAT
& SYSTEM.”

3. TYPES OF FRANCHISING

4. 1) TRADE NAME FRANCHISING
-THE FRANCHISEE PURCHASES THE RIGHT TO USE THE
FRANCHISER’S TRADE NAME WITHOUT DISTRIBUTING
PARTICULAR PRODUCTS EXCLUSIVELY UNDER THE
FRANCHISER’S NAME.

5. 2) PRODUCT DISTRIBUTION FRANCHISING
-A FRANCHISER LICENSES A FRANCHISEE TO SELL ITS
PRODUCTS UNDER THE FRANCHISER’S BRAND NAME &
TRADEMARK THROUGH A SELECTIVE, LIMITED
DISTRIBUTION NETWORK.

6. 3) PURE FRANCHISING
-A FRANCHISER SELLS A FRANCHISEE A COMPLETE
BUSINESS FORMAT & SYSTEM.

7. BENEFITS OF BUYING A FRANCHISE

8. 1) MANAGEMENT TRAINING & SUPPORT

9. 2) BRAND NAME APPEAL

10. 3) NATIONAL ADVERTISING PROGRAMS

11. DRAWBACKS OF BUYING A FRANCHISE

12. 1) FRANCHISE FEES & ONGOING ROYALTIES

13. 2) MARKET SATURATION

14. 3) LESS FREEDOM