Question

a. Differentiate between trade name franchising and business formate franchising.

Answer 1

Answer :-

Some of the Difference between trade name franchising and business formate franchising is mentioned below -

Basis of Difference	Trade name franchising	Business formate franchising
Meaning	The Franchisee can obtain the brand name of the Franchisor and the Franchisor supplies product to the Franchisee.	The Franchisee sells wide range of products or services offered by the Franchisor including marketing, planning and using Franchisor's name.
Distributor is allowed to sale products other than that of Franchisor	In this type of franchise the distribution can sell any products just by displaying trade marks of items	In this case, the distributor can sell only the products related to the business and name of Franchisor.
Approach	Traditional approach	Modern Approach
Fee payment	No fees is paid	Franchisee pays fee
Support from Franchisor	No support is given	Franchisor provides all the required support to the Franchisee
Training by Franchisor	No special training provided	Training provided
Size of each transaction	larger than business formate franchise	smaller than trade name franchise
Type of Franchising	not often comes into the mind of people when thinking about Franchise.	Most common type of franchise nowadays
Franchisor gives to Franchisee	Even without selling products in name of Franchisor, the franchisee purchases the right to use franchisor's trade name.	Franchisor sells complete business system and methods.
Example	Mainly used by automobile(Toyota), beverages sector (Beer, cold-drinks Coco-Cola, Pepsi).	Restaurants sectors (McDonalds,KFC) and in real estate.