O Case Study Evaluating a Business Franchise Acquisition Mike Brady is a graduate of a hospitality college and has worked for large restau rants in several capacities, including middle management. Mike's ambition dans always been to run his own company, Mike prefers to have a well-known fran: chise operation because of the franchisor's quality support and high successi nde Name-brand franchises are costly, and Mike does not have the resources to handle Mike has concluded that he will need investors in his business. Typically investors will demand an ownership interest for their capital. Mike is comfort able with this arrangement and has limited his search for investors to colleagues , he can trust. Mike is preparing a presentation to these potential investors. His Challenge 1. Briefly define franchising, franchise agreement franchisor, franchisee. 2. Name some of the services available from a franchisor. 3. Identify some of the benefits of franchising. 4. List some investigative questions the potential investors might ask about the franchisor. 5. List some particulars that might be included in the initial franchise package offered by a franchisor. Other Noncurrent Assets Accounting 117 6. List any ongoing costs that could be paid to a franchisor. 7. Identify any other concerns the investors might express about the franchise right