Midas Muffler Franchise: Understanding the Roles of Franchisor and Franchisee

Franchise Arrangement

Midas Muffler sells franchises to prospective businesspersons who want to use the Midas name and offer Midas products. In a franchise arrangement, Midas would be the franchisor, and the buyer of the franchise is the franchisee.

Answer:

Franchisor; Franchisee.

Explanation:

A Franchisor is the one who owns a brand, its terms and conditions, and trademarks.

Whereas, a Franchisee is the one who agrees to run a franchise of a location.

When a franchise agreement is made, a company gives the rights to a franchisee. The franchisee then works for the company on their terms and conditions. A franchisee is paid an amount of agreeable fees for his service to the company.

In the given case, Midas is a franchisor who is selling his franchise to the businessperson wanting to run Midas's franchise. And the buyer or the businessperson is a franchisee.