Franchising Basics

When you franchise a business, you are not selling actual businesses. You are selling a method of conducting a business. You trademark the business plan that has brought you success, and allow others to use this method. This makes you a franchisor and those who use your business plan franchisees.

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Franchising Is Growing In the United States

The present indication is that franchising will continue to expand rapidly in the future for several reasons. The general trends toward rising personal income, fairly stable wholesale and retail prices, increased competition for market share, and difficulty in raising sufficient funds to finance company expansions internally, are resulting in many companies, both small and large, turning to franchising as a way to expand the distribution of their services and products. Approximately 400-500 companies start franchising networks each year.

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