Tag: outsourcing and franchising

Questions Related to outsourcing and franchising

Franchising is similar to licensing.

commerce emerging service business in india franchising outsourcing and franchising recent trends of business employment opportunities in commerce

  1. True

  2. False

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Correct Option: A
Explanation:

Under a franchise, the owner (franchisor) retains control of the brand and licenses (that is, grants permissions to) the franchisee to use its successful business model and brand. Licensing of intellectual property (IP) is at the heart of a franchise contract. So, in fact, a franchise includes licensing.

Franchising is the practice of using another firm's successful business model.

commerce emerging service business in india franchising outsourcing and franchising recent trends of business employment opportunities in commerce

  1. True

  2. False

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Correct Option: A
Explanation:

Franchising is based on a marketing concept which can be adopted by an organization as a strategy for business expansion. Where implemented, a franchiser licenses its know-how, procedures, intellectual property, use of its business model, brand, and rights to sell its branded products and services to a franchisee

______ usually set strict rules and regulations as to how the franchisees should operate while running their business.

commerce emerging service business in india franchising outsourcing and franchising recent trends of business employment opportunities in commerce

  1. Franchising

  2. BPO

  3. KPO

  4. All of the above

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Correct Option: A
Explanation:

Franchising is based on a marketing concept which can be adopted by an organization as a strategy for business expansion. Where implemented, a franchiser licenses its know-how, procedures, intellectual property, use of its business model, brand, and rights to sell its branded products and services to a franchisee. 

Characteristic(s) of franchising include(s) ______.

commerce emerging service business in india franchising outsourcing and franchising recent trends of business employment opportunities in commerce

  1. It is a replication of some successful business format

  2. It takes place in case of businesses with a good track record of profitability

  3. It applies to business which are easily duplicated and replicated

  4. All of the above

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Correct Option: D
Explanation:

There are five key characteristics that, more than any others, determine success as a franchisee. They are Any business start-up involves some risk of failure, but a strong franchise with a proven track record of success will minimize this risk.

To see if franchising will suit you check out these nine characteristics:
  • Strong desire to improve business skills.
  • Likes to use proven systems/structure.
  • Believes that customers must be highly valued.
  • Some entrepreneurial spirit.
  • Open to change and feedback.
  • Real ambition to grow a business.
  • Committed to the power of a brand.

Franchising can be terminated before the expiry of franchising period.

commerce emerging service business in india franchising outsourcing and franchising recent trends of business employment opportunities in commerce

  1. True

  2. False

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Correct Option: A
Explanation:

Arrangement where one party (the franchiser) grants another party (the franchisee) the right to use its trademark or trade-name as well as certain business systems and processes, to produce and market a good or service according to certain specifications. The franchisee usually pays a one-time franchise fee plus a percentage of sales revenue as royalty, and gains 

(1) immediate name recognition, 
(2) tried and tested products, 
(3) standard building design and décor, 
(4) detailed techniques in running and promoting the business, 
(5) training of employees, and (6) ongoing help in promoting and upgrading of the products.

Franchising enables the franchiser to increase his goodwill and reputation by expanding his network.

commerce emerging service business in india franchising outsourcing and franchising recent trends of business employment opportunities in commerce

  1. false

  2. partly false

  3. true

  4. partly true

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Correct Option: C
Explanation:

A franchise is a business opportunity that allows the franchisee to start a business by legally using the franchiser's expertise, ideas, and processes. This helps the franchiser to grow his business in the market and increases the goodwill of the franchiser.

Payment of _________ on a regular basis is to be made to the franchiser.

commerce emerging service business in india franchising outsourcing and franchising recent trends of business employment opportunities in commerce

  1. profits

  2. royalty

  3. fees

  4. all of the above

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Correct Option: B
Explanation:

The payment of royalty is the payment made by the franchisee to the franchiser in a regular basis for him to let the franchisee run a business with his established goodwill, trademark and processes.

The franchiser allows the franchisee to use his _______under a license.

commerce emerging service business in india franchising outsourcing and franchising recent trends of business employment opportunities in commerce

  1. trademark

  2. company seal

  3. company goods

  4. company management

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Correct Option: A
Explanation:

The franchiser allows the franchisee to use his trademark under a license to start a business franchise and its processes.

The franchisee does not enjoy exclusive rights in his territory.

commerce emerging service business in india franchising outsourcing and franchising recent trends of business employment opportunities in commerce

  1. false

  2. partly false

  3. true

  4. partly true

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Correct Option: A
Explanation:

The franchisee has started with an established business of the franchiser an enjoys exclusive rights in his territory of business.

If not maintained properly, trade secrets can get divulged to others in the foreign markets. This is a disadvantage of ______.

commerce emerging service business in india franchising outsourcing and franchising recent trends of business employment opportunities in commerce

  1. BPO

  2. KPO

  3. Franchising

  4. Joint Venture

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Correct Option: C
Explanation:

Disadvantages of franchising. Costs may be higher than you expect. As well as the initial costs of buying the franchise, you pay continuing management service fees and you may have to agree to buy products from the franchisor. The franchise agreement usually includes restrictions on how you can run the business.