You’re here because you want to know the franchise definition. In other words, you want this question answered: “What is a franchise?”
If you’re like most people, your answer will be: “Well, Subway® is a franchise. And so is McDonald’s.”
While both answers are true, they don’t define what a franchise is-or does.
With this in mind, I’d like to teach you about franchising. About what a franchise is.
Franchise Definition: What Is A Franchise?
I’m quite confident that if I asked 5 people for their own definition of a franchise, I’d get 5 different answers. But that’s okay. You don’t know what you don’t know.
Having said that, I do feel that knowledge is power. In other words, if you’re seriously thinking of becoming the owner of a franchise business someday, you
should need to learn as much as you can about the franchise business model, and how it works.
That’s because these days, it’s way too risky to go out and buy a franchise just because it’s “hot,” or because you’ve, “always wanted to own a restaurant.”
So, without further ado, here’s the real definition of a franchise business. (Two franchise definitions, actually.)
Here’s my non-legal definition of a franchise;
The entrepreneur (the franchisor) has invented a business, and its model, and is looking to replicate it, by partnering with people that would like an opportunity to own their own business, while building equity for themselves and their families. The franchisor’s own money is invested up front, while company growth is leveraged by using other people’s money. (The franchisees.)
Now, here’s a the textbook-style franchise definition;
A franchise typically involves the granting by one party (the franchisor) to another party (the franchisee) the right to carry on a particular name or trade mark, according to an identified system. Franchises are usually located within a territory or at one specific location, for an agreed upon term. The franchisee is granted a franchise license to use the franchise company’s trademarks, systems, signage, software, and other proprietary tools and systems in accordance with the guidelines set forth in the franchise contract.
Now you have the definition of a franchise, what are you going to do with it?
Are you going to start searching for a franchise opportunity that may make sense for you?
If you’ve already been searching-and you feel that you’ve found one or two good franchise business opportunities, have you begun doing your research?
Are you just curious?
Maybe you’re in a miserable job situation, and you’re trying to decide if you should:
A. Look for another job in the same field
B. Look for a new career
C. Start a business
D. Buy a franchise
E. Avoid the reality of your situation-and just hang out online-watching videos.
(So you can take control of your life-once and for all)