Understanding key franchise terminology to help you navigate your franchise journey with confidence.
A business arrangement where a franchisor grants the right to use their trademark, operating systems, and support in exchange for fees.
The company that owns the brand, trademarks, and business system and grants franchises to independent operators.
An individual or company that purchases the right to operate a franchise business using the franchisor's systems and brand.
A legal document required in many jurisdictions that provides prospective franchisees with essential information about the franchise opportunity.
An upfront payment made by a franchisee to the franchisor for the right to use the brand and operating system.
An ongoing payment, typically a percentage of gross sales, paid by franchisees to the franchisor for continued use of the brand and ongoing support.
A franchise arrangement where the master franchisee has the right to sub-franchise within a defined territory, often an entire country or region.
A contract that grants a franchisee the exclusive right to open multiple franchise units within a specific territory over a defined period.
A comprehensive guide provided by the franchisor that outlines all procedures, standards, and best practices for operating the franchise.
The geographic area in which a franchisee has the right to operate, often with exclusivity protections against other franchisees.
