If a restaurant chain sells the use of its brand name to a Singaporean investor in exchange for a fee and a percentage of sales, the restaurant is entering a foreign market through exporting. True / False.

Question

Dax Rangel

Business

9 September, 11:25

If a restaurant chain sells the use of its brand name to a Singaporean investor in exchange for a fee and a percentage of sales, the restaurant is entering a foreign market through exporting. True / False.

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Answers (1)

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Elsie Cervantes · Answer 1

False

Explanation:

This type of agreement is a brand licensing contract. In this type of agreement, the licensor (restaurant chain) gives permission to a licensee (Singaporean investor) to produce their products or services in a certain geographical area in exchange for a royalty, a sales percentage or a combination of both.