Paper 2 · November 2019 · franchising
State the ongoing payment, usually a percentage of turnover, that a franchisee makes to the franchisor.
Model answer
royalty
Also accepted: royalties, royalty payment, royalty fee
Explanation
The franchisee pays an initial fee to join the chain and then a continuing royalty on sales for as long as it trades. The royalty is what turns the franchisor's brand into a regular income stream.
Derived from ZIMSEC Business Enterprise Skills Paper 2, Nov 2019, Q1