Question

From Two Men and Truck to 220 Franchises and 1400 Trucks Two Men and a Truck operates in the _________, like nearly half of all small businesses.

production industry

distribution industry

restaurant industry

service industry

finance industry

For Mary Ellen Sheets, founder of Two Men and a Truck, owning and operating a small business provides many advantages. Which of the following is NOT an advantage of small business ownership?

Simplified recordkeeping

Ability to adapt to change

Independence

Ability to raise capital

Ability to develop personal relationships with employees and customers

To expand her business, Mary Ellen Sheets used franchising. Under its franchising situation, Two Men and a Truck serves as the ______ so that other individuals can use its brand, business model, and other resources.

franchisor

franchisee

landlord

licensor

licensee

Franchising offers many potential benefits for firms like Two Men and a Truck that are looking to expand. Which of the following is NOT one of these advantages?

Retaining more capital for expanding production and advertising

Gaining motivated franchisees

Gaining fast and controlled distribution

Consistency of advertising messages when using a national promotion campaign

Having to spend capital to construct and operate its own outlets

As Two Men and a Truck grew, its founders and executives were quick to seek help in areas where they lacked knowledge and experience. What is one of the best sources for help, especially education, training, counseling, and even financial assistance?

Venture capitalists

Small Business Administration

Minority Business Development Agency

Deloitte & Touche

Service Core of Retired Executives

Answer 1

From Two Men and Truck to 220 Franchises and 1400 Trucks Two Men and a Truck operates in the _________, like nearly half of all small businesses.

Distribution industry

The company operates in distribution industry. It does not have a production unit or a restaurant. It does provide a service of distribution, however, because of nature of the service, distribution is considered as a separate industry for all practical purposes. It definitely is not a financing company as this is not its core business.

For Mary Ellen Sheets, founder of Two Men and a Truck, owning and operating a small business provides many advantages. Which of the following is NOT an advantage of small business ownership?

Ability to raise capital

Small companies have a difficulty in raising capital. Their need for capital is small but the sources are even smaller and costlier. It cannot raise money from the public directly due to regulatory restrictions. It can raise funds from the banks but the cost of debt is generally higher for smaller companies.

To expand her business, Mary Ellen Sheets used franchising. Under its franchising situation, Two Men and a Truck serves as the ______ so that other individuals can use its brand, business model, and other resources.

Franchisor

This is the definition of the franchisor model.

Franchising offers many potential benefits for firms like Two Men and a Truck that are looking to expand. Which of the following is NOT one of these advantages?

Having to spend capital to construct and operate its own outlets

The biggest advantages of the franchisee model is that the franchisor does not have to provide the capital for opening the new outlets by the franchise owners. The capital is raised by the franchise owners. The franchisor only provides the brand name, expertise and training to the outlet.

As Two Men and a Truck grew, its founders and executives were quick to seek help in areas where they lacked knowledge and experience. What is one of the best sources for help, especially education, training, counseling, and even financial assistance?

Service Core of Retired Executives

SCORE is the best source for such guidance for a company like this. It is a nonprofit organization that provides free business mentoring services to prospective and established small business owners in the US and has more than 1000 volunteers. Venture capitalist invest in the company from financial point of view and the owners usually lose the control over the company. Small Business Administration also provides aid to small business but their focus is mainly on economic recovery after disasters rather than strategic expansion of the business. Minority Business Development Agency focuses their efforts on development of business by minority communities such as Hispanics, Asians, African Americans and so on. Deloitte & Touche is a private management consulting company. Services of such company could be out of budget for such a small company. Hence, SCORE is the best option for this company.