Question

The individual or firm which grants right is called _________ (X). Whereas the individual or firm to whom the right is granted is called _________.(Y).
Select the correct answer from the options given below.

• A. (X) = Franchisee; (Y)=Franchiser
• B. (X) = Franchiser; (Y)=Franchisee
• C. (X) = Consignor; (Y)=Consignee
• D. (X) = Consignee; (Y)=Consignor

Answer 1

The correct option is B (X) = Franchiser; (Y)=Franchisee

Franchising is basically a specialised form of licensing in which the franchiser not only sells intangible property (normally a trademark) to the franchisee, but also insists that the franchisee agrees to abide by strict rules as to how it does business.