Which of the following best describes a franchise?

The correct answer describes a franchise as a business model that grants rights to individuals or businesses to sell a brand's products or services. This arrangement allows someone (the franchisee) to operate a business under the established brand identity, using the company’s trademarks, trade name, and operational model, while typically paying royalties or fees to the franchisor.

This definition encapsulates the essence of franchising, which is a collaborative business strategy that combines the independence of individual business ownership with the support and recognition of an established brand. Franchises benefit from a proven business system, marketing support, and ongoing training, which significantly improves their chances of success compared to independent startups.

In contrast, the other options reflect aspects of business but do not accurately capture the comprehensive nature of franchising. For instance, while franchising involves product distribution, it is much broader than just a method of distribution. It includes the entire business relationship between the franchisee and franchisor, making option a less complete choice. Similarly, while there are financial implications in franchising, it is not solely a form of financial investment, nor is it an employment contract as its focus is on a business partnership rather than an employee-employer relationship. Thus, option B stands out as the most fitting and