Consider two retailers that rely on franchisees to sell their products. Company X relies exclusively on franchised outlets that are owned by independent businesspeople. Company Y relies on franchisees to run 75% of their stores but is vertically integrated and owns and operates the remaining 25% of stores. Labor costs are a key part of store operations. Which company is likely better situated to engage with franchisees regarding necessary contract adjustments due to the sharp rise in labor costs since the COVID-19 pandemic? Question 3 options: a) Company X. b) Company Y. c) Both companies are equally well situated to address labor cost concerns.