What Is a Disadvantage of Franchising

question 71

Multiple Choice

What is a disadvantage of franchising?

• A) The franchiser has to bear development costs and risks associated with foreign expansion.
• B) Franchising leads to undesirable results for service firms.
• C) It is difficult to maintain quality control across foreign franchisees that are distant from the franchiser.
• D) The franchiser has no long-term interests in the foreign country.
• E) It forces a franchiser to take out profits from one country to support competitive attacks in another.

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Definitions:

Completed Audit

A comprehensive examination and verification of an organization's financial and operational systems, which has been fully carried out.

Substantially Performed

A legal principle recognizing that a contract has been completed enough to warrant fulfillment despite minor deviations.

Contract Breach

An instance in which one party fails to fulfill its obligations under a contract, whether partially or entirely.

Complete Compensation

Total financial restitution provided to cover all losses and damages incurred.