Franchisee - Is the owner/investor of the operating unit or business.
Franchisor - The mother company. Entity offering a legal business opportunity as above described.
What is Franchising?
Historical Definition
Historically, the word "franchise" has meant the granting of a right or privilege
to an individual or group. In recent years the definition has come to also include such other arrangements as licensing, dealerships
and distributorships to name a few.
Regulatory Definition
The Federal Trade Commission defines a franchise as a business
agreement or relationship, regardless of its title, in which the business investor/buyer -
1. Is Required
to use a Common Business Name (such as Kentucky Fried
Chicken , Dunkin' Donuts , Sir Speedy Printing or Holiday Inn );
2. Receives Training,
Assistance or Guidance (from the parent company);
3. Pays a Fee to the Parent Company ($500 or more
within the first six
months of operations).
Business Definition
these three elements, it is still a "franchise" even though it could be called a license, dealership, distributorship or association and therefore such agreement must comply with said Rule and certain State Regulations.
Your Business.
A method of marketing.
A method of growth enhancement.
A method of capital acquisition.
A method of employment.
