What is franchising?

Franchising is a business system. It involves one party (the franchisor) granting another (the franchisee) the right to operate a replicated franchise business under that trade name and use established management, marketing and operating procedures. In return the franchisee commits to paying the franchisor a capital investment, ongoing fees and complying with franchise procedures.

Franchising can be an excellent way for you to own your own small business while benefiting from the experience and security of an established system. However, purchasing a franchise is not a guarantee of success. You should carefully evaluate the advantages and disadvantages of a franchise before entering into a franchise agreement and make sure you are aware of what your responsibilities will be as a franchisee.