Question

Fuller contracted with the owners of "Healthy Bakeries" to open a bakery, sell its signature products and use its name and logo. This agreement refers to a

a) Licensing agreement
b) Joint venture
c) Franchise agreement
d) Distribution agreement

Answer 1

Fuller's agreement with "Healthy Bakeries" is a franchise agreement, wherein Fuller will pay for the rights to use the company’s business model, brand name, and receive various forms of support.

Step-by-step explanation:

The agreement Fuller entered into with the owners of "Healthy Bakeries" to open a bakery, sell its signature products, and use its name and logo is best classified as a franchise agreement. A franchise allows the franchisee to start a business by purchasing the rights to use a business model designed by the franchisor. In a typical franchise, the franchisor not only allows the use of its brand name and logo but often provides essential support in the form of training, supply chain assistance, and help with setting up operations. In exchange for these benefits, the franchisee agrees to pay a franchise fee and ongoing royalty fees.