General Franchising

• A franchise is when a business gives another business the right to supply its product or service
• The franchisee normally pays an initial fee to the franchisor and then a percentage royalty on sales
• Franchising classes as a form of organic or internal growth for the franchisor
• How a franchise works:

  • franchisee sells the franchisor's products or services
  • trade under the franchisor trade mark or trade name
  • benefit from the franchisor's help and support
  • franchisee owns the outlet he or she runs, but the franchisor maintains control over how products are marketed and sold and how their business idea is used