In some cases, a firm will buy the rights to produce, promote, and use the domestic firm's trademark/patents in a defined geographical area with an agreement on specific operating procedures. What is this practice called?
A) franchising
B) exporting
C) outsourcing
D) strategic contracting

Question

Quizplus · Accepted Answer

Franchising is the practice of a firm buying the rights to produce, promote, and use the domestic firm's trademark/patents in a defined geographical area with an agreement on specific operating procedures. This allows the franchisor to expand their business without the upfront costs and risks of opening new locations themselves.

In Some Cases, a Firm Will Buy the Rights to Produce