Practicing Success

Target Exam

CUET

Subject

Entrepreneurship

Chapter

Enterprise growth Strategies

Question:
Assertion: Most bottlers of soft drinks use Manufacturing franchise opportunity model of franchising.
Reasoning: Manufacturing franchising model typically require that a business owner purchases and distributes the products for one specific company.
Options:
Both Assertion (A) and reasoning (R) are correct and R is the correct explanation of A.
Both Assertion (A) and reasoning (R) are correct and but R is not the correct explanation of A.
Assertion (A) is true but Reasoning (R) is not correct.
Assertion (A) is not true but Reasoning (R) is correct.
Correct Answer:
Assertion (A) is true but Reasoning (R) is not correct.
Explanation:
R is incorrect.
Manufacturing franchise opportunity: These types of franchises provide an organization with the right to manufacture a product and sell it to the public, using the franchisor's name and trademark. This type of franchise is found most often in the food and beverage industry. Most bottlers of soft drinks receive a franchise from a company and must use its ingredients to produce, bottle and distribute the soft drinks.
Business franchise opportunity ventures: These ventures typically require that a business owner purchases and distributes the products for one specific company. The company must provide customers or accounts to the business owner, and in return, the business owner pays a fee or other consideration as compensation. Examples include vending machine routes and distributorships.