"Franchising is based on a marketing concept which can be adopted by an organization as a strategy for business expansion."
A type of business that involves a franchisee purchasing the right to use a parent company’s name, products, and services.
Franchise business model: Learn about franchise business model including the rights, obligations, and responsibilities of both the franchisor and franchisee.
Choosing a franchise: Understand factors to consider when choosing a franchise, including industry, investment required, brand reputation, and competitive landscape.
Franchise legal requirements: Learn about the legal requirements of franchising, including franchise disclosures, trademarks, and franchise agreements.
Financing a franchise: Understand the different financing options available for starting a franchise, including SBA loans and franchisor financing options.
Franchise operations: Get an overview of day-to-day operations of running a franchise, including hiring and training employees, marketing, and managing finances.
Support from franchisor: Learn about the support provided by franchisors, including training, marketing, and ongoing operational support.
Franchisee relationship with franchisor: Understand the relationship between the franchisee and franchisor, including communication channels, reporting requirements, and conflict resolution.
Franchise regulations: Get an overview of franchise regulations and laws, including the Federal Trade Commission's Franchise Rule and state-specific franchise regulations.
Product Distribution: In this type, the franchisee sells the franchisor's product or service through a retail outlet or store. The franchisee is responsible for managing inventory, marketing the products, and maintaining the business.
Business Format: A franchisor provides the franchisee with a proven business system, including training and ongoing support. Business format franchising is the most common type of franchise.
Management: In this type of franchise, the franchisor manages the daily operations of the business, while the franchisee holds ownership rights.
Single-Unit: A single-unit franchise is typically the most common type of franchise, where the franchisee owns and operates one franchise location.
Multi-Unit: A multi-unit franchisee owns and operates multiple franchises in different locations. This type of franchise requires more investment, experience, and management skills.
Area Development: An area development franchisee agrees to develop several franchises within a specific geographic area within a certain time frame. This type of franchise requires a significant investment.
Master Franchise: In this type of franchise, a master franchisee has the exclusive rights to develop and sell franchises within a specific geographic area.
Co-Branding: In this type of franchise, two or more brands join together to operate under one franchise system. For example, a coffee chain might partner with a donut chain to form a single franchise.
Conversion: A conversion franchise is when a business that is independently owned and operated becomes a franchise through an agreement with a franchisor.
Online and Home-Based: These franchises allow people to work from home or online using the franchisor's business model and support, without requiring a physical storefront.
"A franchisor licenses some or all of its know-how, procedures, intellectual property, use of its business model, brand, and rights to sell its branded products and services to a franchisee."
"The franchisee pays certain fees and agrees to comply with certain obligations, typically set out in a franchise agreement."
"Adopting a franchise system business growth strategy for the sale and distribution of goods and services minimizes the franchisor's capital investment and liability risk."
"Franchising is rarely an equal partnership, especially in the typical arrangement where the franchisee is an individual, unincorporated partnership or small privately-held corporation."
"Under specific circumstances like transparency, favorable legal conditions, financial means, and proper market research, franchising can be a vehicle of success for both a large franchisor and a small franchisee."
"Thirty-six countries have laws that explicitly regulate franchising."
"The majority of all other countries have laws which have a direct or indirect effect on franchising."
"The word franchise is of Anglo-French derivation—from franc, meaning 'free'."
"Franchising is also used as a foreign market entry mode."
"A franchisor has other alternatives for business growth strategy, compared to expansion through corporate owned outlets or 'chain stores'."
"The usual exception to this rule is when the prospective franchisee is also a powerful corporate entity controlling a highly lucrative location and/or captive market."
"A franchisor licenses some or all of its know-how, procedures, intellectual property, use of its business model, brand, and rights to sell its branded products and services to a franchisee."
"The franchisee pays certain fees [...] typically set out in a franchise agreement."
"The franchisee is an individual, unincorporated partnership or small privately-held corporation."
"Franchising can be a vehicle of success for a large franchisor."
"Franchising can be a vehicle of success for a small franchisee."
"Franchise agreement typically sets out certain obligations for the franchisee."
"Prospective franchisors must then compete to exclude one another."
"Transparency, favorable legal conditions, financial means and proper market research" contribute to the success of franchising.