What term describes a contract-based business arrangement between a manufacturer and a dealer?

The term that describes a contract-based business arrangement between a manufacturer and a dealer is franchising. This term encompasses the entire system wherein a franchisor (the manufacturer or brand owner) grants a franchisee (the dealer or retailer) the right to operate a business using its trademark, products, and proven business methods. Franchising embodies the legal and operational framework that allows the franchisee to benefit from the brand's established reputation while adhering to the terms set forth by the franchisor.

In this arrangement, the franchisor provides the franchisee with the necessary support, including training, marketing, and operational guidelines, while the franchisee operates the business under the franchisor’s brand. This relationship is mutually beneficial, as franchisees gain the advantage of a recognized brand and established business practices, while franchisors expand their market presence without incurring the burden of direct management.