What is a key characteristic of franchising?
A) The franchisor assumes the identity of the franchisee.
B) Franchisees manufacture the products sold by franchisors.
C) The franchisee appears to be a subsidiary of the franchisor.
D) The franchisee sells competing brands in the product category.
E) Franchisors and franchisees share downstream channel functions.

Question

Quizplus · Accepted Answer

A key characteristic of franchising is that the franchisee appears to be a subsidiary of the franchisor. This is because the franchisor provides the franchisee with a trademark, operating manual, and ongoing support, while the franchisee operates under the name and brand of the franchisor. However, the franchisee remains an independent business owner and is responsible for the day-to-day operation of the business.

What Is a Key Characteristic of Franchising