A contractual agreement between two firms that allows one of the firms to operate a retail outlet, using a name and format developed and supported by the other firm, is called:
A)outsourcing.
B)franchising.
C)patenting.
D)consulting.
E)cross-licensing.

Question

Quizplus · Accepted Answer

Franchising is a contractual agreement between two firms, where one firm (franchisee) is allowed to operate a retail outlet using the name and format developed and supported by the other firm (franchisor). The franchisee pays a fee to the franchisor for the right to use their brand and business model, and in return, the franchisor provides training, support, and ongoing assistance to the franchisee.

A Contractual Agreement Between Two Firms That Allows One of the Firms