Franchise
Content
Definition
Franchise is a method of business expansion where a company (franchisor) licenses its business model and brand to an independent operator (franchisee).
Usage and Context
Franchises let businesses grow fast by letting others open new locations. Famous examples are the fast food chains. This way, the original business spreads its brand without opening all the shops itself.
Frequently asked questions
- What is franchising in business? Franchising in business means letting someone else open a new location of your brand. They run it, but follow your rules and share profits.
- Why is it called franchise? It`s called a franchise because it`s about giving rights. The word comes from the French term for freedom or privilege. In this case, it`s the right to use a business model and brand.
- Does franchise mean own? Yes and no. A franchisee owns their business locally but must follow the franchisor`s rules and share profits.
Benefits
Franchises can grow quickly and reach new markets. It reduces the risk for the franchisor while allowing entrepreneurs to start businesses with an established brand.
Conclusion
Franchising is a smart way to expand a business. It benefits both the original company and local entrepreneurs. It`s all about spreading success.
