Pelican Inc., a multinational oil corporation headquartered in Denmark, conducts its operations in various nations by establishing an outlet in different locations. Each outlet creates a separate corporation to own and perform the functions of Pelican Inc. Given this scenario, we can conclude that Pelican Inc. operates through _____.

Question

Quizplus · Accepted Answer

From the given scenario, we can conclude that Pelican Inc. operates through franchising. The franchising relationship is contractual. The franchisor has developed a product or service or a particular pattern of marketing it, and the franchisee becomes an outlet in what appears to be a regional or national (or even international) chain. The franchisor may conduct its business as a sole proprietorship, partnership, or corporation and so may the franchisee. Typically, the franchisor is a corporation, and often the franchisee forms a corporation to own and operate the franchised business.