Discover published sets by community

A franchise is a type of license that grants a franchisee access to a franchisor's proprietary business knowledge, processes, and trademarks, thus allowing the franchisee to sell a product or service under the business's name. Example: McDonald's restaurants.

A franchisor is a company that owns the overall rights and trademarks of the company and allows its franchisees to use these rights and trademarks to do business. Example: Subway.

A franchisee is an individual or company that holds a franchise for the sale of goods or services in a certain area. They operate under the franchisor's brand and business model. Example: An owner of one particular Dunkin' Donuts shop.

The franchise agreement is a legal, binding contract between the franchisor and franchisee, outlining the terms and responsibilities of the franchise relationship. Example: The contract that details how a KFC outlet should be operated.

A franchise fee is an upfront cost paid by the franchisee to the franchisor, typically for the right to use the franchisor's brand and system, and to receive initial training and support. Example: Initial payment to open a Hilton hotel franchise.

Royalty fees are ongoing payments made by the franchisee to the franchisor, usually based on a percentage of the franchisee's sales revenue. Example: A monthly payment from a 7-Eleven store owner based on the store's sales.

The Franchise Disclosure Document is a legal document provided by the franchisor to potential franchisees, which contains information essential to evaluating a franchise investment. Example: Contains information about McDonald's policies and earnings.

Territorial rights are guarantees given to franchisees that they will have exclusive rights to operate and market in a certain geographic area. Example: A Starbucks franchisee may have exclusive rights in their particular district.

An advertising fee is a fee paid by the franchisee to the franchisor, used specifically for brand promotion and advertising at a national or regional level. Example: Contributions to a national television campaign for Domino's Pizza.

The operations manual is a comprehensive document provided by the franchisor to the franchisee, detailing the necessary procedures, standards, and quality control for operating the franchise. Example: Guidelines on running a Holiday Inn Express efficiently and consistently.

Conversion franchising is a strategy where an existing independent business is converted into a franchise unit, adopting the franchisor’s name, identity, and business model. Example: Independent real estate agencies converting into Century 21 franchises.