ITPEC IP October 2023 Question 79
ITPEC IP October 2023 — Question 79 of 100
A franchise chain grants contracted member stores the right to use a business model, trademark, and operating know-how in return for fees or royalties. The franchisor supplies brand standards, systems, training, products, and support, while each franchisee operates under the agreement.
Answer (c)
Why not others:
- (a) Outlet store sells discounted, surplus, or manufacturer-direct products
- (b) Concept shop presents products around a particular lifestyle, theme, or brand concept
- (d) Voluntary chain is cooperation among independent retailers for activities such as joint purchasing while retaining broader independence
Key rule: Trademark and know-how rights granted by contract in return for royalties identify franchising.
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