Midas Muffler Franchise: Understanding the Roles of Franchisor and Franchisee
Franchise Arrangement
Midas Muffler sells franchises to prospective businesspersons who want to use the Midas name and offer Midas products. In a franchise arrangement, Midas would be the franchisor, and the buyer of the franchise is the franchisee.
Answer:
Franchisor; Franchisee.
Explanation:
A Franchisor is the one who owns a brand, its terms and conditions, and trademarks.
Whereas, a Franchisee is the one who agrees to run a franchise of a location.
When a franchise agreement is made, a company gives the rights to a franchisee. The franchisee then works for the company on their terms and conditions. A franchisee is paid an amount of agreeable fees for his service to the company.
In the given case, Midas is a franchisor who is selling his franchise to the businessperson wanting to run Midas's franchise. And the buyer or the businessperson is a franchisee.
What is the role of a franchisor in a franchise arrangement? The franchisor is the one who owns the brand, its terms and conditions, and trademarks in a franchise arrangement.