Franchising involves semi-independent franchisees paying fees and royalties to a franchiser in exchange for using the franchiser's trademark, selling its products or services, and often using its business format and system. There are three main types of franchising: trade name franchising which allows use of the franchiser's name without exclusive product distribution; product distribution franchising which licenses franchisees to sell franchiser products under its brand name; and pure franchising which sells a complete business format and system. Some advantages of buying a franchise include management training and support, brand name appeal, and national advertising programs, while drawbacks include franchise fees and royalties, market saturation, and less business freedom.

1. CHAPTER 6 DEFINE & EXPLAIN WHAT FRANCHISING IS. EXPLAIN THE 3 MAIN TYPES OF FRANCHISING. WHAT ARE SOME ADVANTAGES TO FRANCHISING? WHAT ARE SOME DRAWBACKS TO BUYING A FRANCHISE?

2. FRANCHISING -”SEMI-INDEPENDENT BUSINESS OWNERS (FRANCHISEES) PAY FEES & ROYALTIES TO A PARENT COMPANY (FRANCHISER) IN RETURN FOR THE RIGHT TO BECOME IDENTIFIED WITH ITS TRADEMARK, TO SELL ITS PRODUCTS OR SERVICES, & OFTEN TO USE ITS BUSINESS FORMAT & SYSTEM.”

3. TYPES OF FRANCHISING

4. 1) TRADE NAME FRANCHISING -THE FRANCHISEE PURCHASES THE RIGHT TO USE THE FRANCHISER’S TRADE NAME WITHOUT DISTRIBUTING PARTICULAR PRODUCTS EXCLUSIVELY UNDER THE FRANCHISER’S NAME.

5. 2) PRODUCT DISTRIBUTION FRANCHISING -A FRANCHISER LICENSES A FRANCHISEE TO SELL ITS PRODUCTS UNDER THE FRANCHISER’S BRAND NAME & TRADEMARK THROUGH A SELECTIVE, LIMITED DISTRIBUTION NETWORK.

6. 3) PURE FRANCHISING -A FRANCHISER SELLS A FRANCHISEE A COMPLETE BUSINESS FORMAT & SYSTEM.

7. BENEFITS OF BUYING A FRANCHISE

8. 1) MANAGEMENT TRAINING & SUPPORT

9. 2) BRAND NAME APPEAL

10. 3) NATIONAL ADVERTISING PROGRAMS

11. DRAWBACKS OF BUYING A FRANCHISE

12. 1) FRANCHISE FEES & ONGOING ROYALTIES

13. 2) MARKET SATURATION

14. 3) LESS FREEDOM