FRANCHISING REVIEWER mix

Question 1

SHE is known to be the first commercial franchisor

Answer 1

Martha Matilda Harper

Question 2

the payment to franchisor based on the gross sale is

Answer 2

Royalty

Question 3

the franchising born spear headed by blank in late 1950s

Answer 3

Ray Kroc Mcdonalds

Question 4

most gasoline products sold through the blank system of franchising

Answer 4

Product Distribution

Question 5

The franchisee not only uses the
franchisor’s brand and products but also follows a complete
business system provided by the franchisor, including
operations, marketing, training, and more

Answer 5

Business Format Franchise

Question 6

often called the Franchise Disclosure
Document, or FDD, in many jurisdictions like the U.S.) is a
legal document that a franchisor must provide to a potential
franchisee before any agreement is signed.

Answer 6

Disclosure Statement

Question 7

is to provide prospective
franchisees with information about the franchisor, the
franchise system and the agreements they will need to sign so
that they can make an informed decision.

Answer 7

FDD

Question 8

e is a business model where the owner
of a trademark, business model, or system (the franchisor)
allows others (the franchisees) to operate a business using
their brand, processes, and support system

Answer 8

Franchise

Question 9

is a legally binding contract between
the franchisor and the franchisee. This document outlines the
terms and conditions under which the franchise will operate,
including the franchisee’s rights, obligations, fees, and
duration of the agreement.

Answer 9

Franchise Agreement

Question 10

A Business method of expansion that allows an
individual or a group of individuals to market a product or a
service and to use the patent, trademark, trade name and
systems prescribed by the owner

Answer 10

Franchising

Question 11

is an individual or company that purchases the
rights to operate a business under the brand name and business
model of an established franchisor

Answer 11

Franchisee

Question 12

THE OWNER OF THE BUSINESS
THAT PROVIDES THE PRODUCT/SERVICE

Answer 12

Franchisor

Question 13

• The franchisee sells the franchisor’s
  products but doesn’t necessarily operate the same business
  model. Examples include car dealerships or soft drink
  distribution.

Answer 13

Product Distribution

Question 14

These fees are usually calculated as a
percentage of the franchisee’s gross sales or revenue and are
typically paid on a regular basis

Answer 14

Royalty Fee

Question 15

refers to the legally protected brand name, logo,
slogan, or other distinctive symbols that represent a business
or franchise. The trademark is a key asset for the franchisor, as
it helps distinguish the franchisee’s business from others in the
marketplace.

Answer 15

Trademark

Question 16

-refers to the activities of producing, buying,
selling, or exchanging goods and services to satisfy the needs
and wants of customers.

Answer 16

Business

Question 17

in a business context refers to the amount of money
spent on producing goods, providing services, or running
business operations.

Answer 17

Cost

Question 18

• in the franchising business refers to the
  presence of other businesses whether they are other franchises
  or independent companies that offer similar products or
  services in the same market or geographic area.

Answer 18

Competition

Question 19

is the name given to a
company, product, or service that distinguishes it from other
entities in the marketplace. It serves as a unique identifier and
is crucial for building brand recognition, trust, and loyalty
among consumers.

Answer 19

Brand Name

Question 20

to the money or earnings that an
individual or business receives in exchange for labor, services,
or investments. It’s the total amount of money a person or
entity receives over a period of time, before any deductions
such as taxes or expenses.

Answer 20

Income

Question 21

refers to something that can be physically
touched or perceived by the senses, particularly by touch.

Answer 21

Tangible

Question 22

• refers to things that cannot be physically
  touched or perceived by the senses, particularly by touch.

Answer 22

Intangible

Question 23

• is a fixed, regular payment that an employee
  receives from their employer in exchange for the work they
  perform.

Answer 23

Salary

Question 24

is a snapshot summary of how much a
company is worth on any given day. It reports the financial
condition (solvency) of the franchisor.

Answer 24

Balance Sheet

Question 25

what a company owns: current, fixed and intangible assets

Answer 25

assets

Question 26

what a company owes: current and long-term debt

Answer 26

liabilities

Question 27

the company’s net worth; it is the money the company has taken in from the sale of stock plus any accumulated profits

Answer 27

stockholders' equity

Question 28

Minnesota follows federal regulations in areas like tax law, labor law, and civil rights, but also has its own state-specific rules

Answer 28

Minnesota Law

Question 29

- is a legal contract between a franchisor (the company or brand owner) and a franchisee (the individual or entity purchasing the franchise).

Answer 29

Franchise Agreement

Question 30

exists where a seller provides goods or services to a buyer to enable the buyer to start a business;

Answer 30

A business opportunity

Question 31

(often referred to as a joint venture or partnership) is a collaboration between two or more businesses or individuals to work together on a specific project, product, or service

Answer 31

Joint Business Relationship

Question 32

refers to a group of individuals, organizations, or entities that share common goals, concerns, needs, or interests.

Answer 32

Community of Interest

Question 33

Most states that regulate franchise sales, the heart and soul of Minnesota franchise sales regulation is the requirement that a franchise offering be registered with a state administrative official before it may be offered to anyone.

Answer 33

Regulations and Disclosure

Question 34

is the primary federal agency responsible for regulating franchise businesses in the United States. Its primary regulation is the Franchise Rule, which ensures transparency and fairness in the franchise relationship by requiring franchisors to disclose certain information to potential franchisees

Answer 34

Federal Trade Commission or FTC

Question 35

also govern franchise agreements and the franchising process. Some states have more stringent rules than the federal requirements, designed to provide additional protection to franchisees

Answer 35

State Regulation

Question 36

: Requires state approval before offering franchises.

Answer 36

Registration and Review

Question 37

Franchisors file a notice with the state but do not need approval.

Answer 37

Notice Filing

Question 38

Franchisors only need to file the FDD without state review or approval.

Answer 38

Disclosure-Only

Question 39

The state performs a basic review for compliance but does not deeply analyze the FDD.

Answer 39

Cursory Review

Question 40

Certain franchisors are exempt from filing or registration requirements if they meet specific criteria.

Answer 40

Exemption Filing

Question 41

FDD be delivered no later than 14 days before the prospective franchisee signs a contract

Answer 41

Cooling Off Provision

Question 42

An “impound order,” the franchisor is required to deposit all initial franchise fees into the prescribed escrow account under a three-party agreement between the franchisor, the bank and the Minnesota Department of Commerce.

Answer 42

Financial Conditions to Registration

Question 43

The potential franchisee should be given a duplicate of any one-sided alterations affected by the franchisor to the Franchise Agreement or other contracts that are part of the Disclosure Document at least seven calendar days before signing. This ensures that the franchisee will have sufficient time to review the changes before signing the contract.

Answer 43

Material Changes to the Form Agreement

Question 44

Revisions undertaken and negotiated by the franchisee or entries clerical are excluded from disclosing a final version of the Franchise Agreement at least seven days before signing.

Answer 44

Negotiating a Franchise

Question 45

These involve third-party agents or brokers helping sell franchise opportunities, but the franchisor remains responsible for compliance with legal requirements.

Answer 45

Independent Franchise Sales

Question 46

In some cases, such as in specific exemptions, an FDD may not be required. However, the lack of an FDD can increase risks for potential franchisees, as they may lack crucial information

Answer 46

No Mandatory FDD

Question 47

Buyers should always conduct thorough due diligence, consult with professionals, and review the franchise agreement carefully, even if an FDD is not mandatory.

Answer 47

Recommended Buyer Action

Question 48

The franchisor is generally required to provide an FDD to the prospective franchisee at least 14 days before any contract is signed or payment is made.

Answer 48

Franchisor's FDD Obligation

Question 49

Laws that govern the ongoing relationship between franchisors and franchisees.

Answer 49

Franchise Relationship Regulation

Question 50

Key Provisions of Minnesota's Franchise Relationship

Answer 50

1. Prohibition of Termination Without Good Cause 2. Unfair Practices Provisions

Question 51

Overcoming the challenges associated with adapting to changing market trends in a franchise requires a multifaceted approach, focusing on Agility, communication, research, and innovation.

Answer 51

Adapting to changing market trends

Question 52

Overcoming the challenges associated with dealing with legal compliance issues requires a thorough understanding of relevant regulations and policies, Staying updated on legal requirements and industry trends establishing clear compliance policies, and adopting effective risk management strategies.

Answer 52

Legal Compliance Issues

Question 53

Franchise management can overcome the challenges associated with hiring and retaining employees by implementing the following strategies:

Answer 53

Hiring and Retaining Employees

Question 54

- Franchises can overcome the challenge of maintaining consistency across their brand by implementing effective operational guidelines providing:

Answer 54

4. Maintaining Consistency Across the Brand

Question 55

Overcoming financial management issues in a franchise requires identifying root causes, establishing a strong financial system, employing financial technology tools, fostering open communication, and vigilant planning

Answer 55

Financial Management

Question 56

Businesses can choose among a wide range of distribution and expansion strategies. Sometimes, the choice is obvious. At other times, the choice is the consequence of an analytical process.

Answer 56

Planning a Distribution Program

Question 57

Businesses must assess the suitability of Franchising for their products or Services. Franchising may not be ideal for manufacturers focused solely on selling products.

Answer 57

SUITABILITY OF FRANCHISING SUITABILITY OF FRANCHISING