Question

Burger King licenses its brand name to foreign firms as long as they agree to run their restaurants on exactly the same lines as Burger King restaurants elsewhere in the world. In return, the foreign firms have to pay Burger King a percentage of their profits. This is an example of ___________.a. exporting b. entering a strategic alliance c. franchising d. undertaking a greenfield investment e. offshoring

Answer 1

Answer:

c. franchising

Explanation:

Franchising -

It refers to the practice of financing any startup or organization , under a specified name , is referred to as franchising .

The franchisee need to pay some specific amount as soon as he take up the brand name , which is referred to as the franchise agreement .

Hence , from the given scenario of the question ,

The correct answer is c. franchising .

Answer 2

Answer:

C. Franchising

Explanation:

Franchise is a form of business in which a brand sells rights to use their name, logo & model to third party agency sellers ; on contract of standardised good/ service & profit share.

This is a great model for franchisors (provider of franchise name), as they can expand their brand name & simultaneously earn profit share due to previously acquired goodwill. It is also beneficial for franchisees (purchase of franchise name) as can save time of making their own goodwill in business & can get advantage of franchisor's goodwill.

Burger King licensing name to foreign firms on agreement of : Standardised production , processing lines & profit share is an example of - Franchise model of Business.