Do You Really Know Your Franchise Terms?
From our friends at WIKIPEDIA: Franchising is the practice of using another firm’s successful business model. The word ‘franchise’ is of Anglo-French derivation – from franc – meaning free, and is used both as a noun and as a (transitive) verb. For the franchisor, the franchise is an alternative to building ‘chain stores’ to distribute goods that avoids the investments and liability of a chain.
The franchisor’s success depends on the success of the franchisees. The franchisee is said to have a greater incentive than a direct employee because he or she has a direct stake in the business. We’ve endeavored to be as thorough and accurate as possible; however, as franchising is an ever-evolving business format, new franchising terms and terminology will undoubtedly be introduced over time. If you can’t find a clear definition to a franchise term in this Glossary, please contact us and we’ll make every effort to update this franchise terms glossary website.
This franchise glossary has been meticulously constructed to be as accurate as possible. While some franchise terms are based on generally accepted definitions, other franchise terms may be subject to differing interpretations and uses. Franchising is an evolving and changing business format and, as such, the terminology used by its practitioners is similarly fluid. The intent of this glossary is to give the reader an introduction to some of the language used in franchising. It is not intended to be all inclusive but merely one tool to understanding this unique business format.
Thanks must be given for the substantial assistance received from:
- The International Franchise Association (www.Franchise.org)
- The Educated Franchisee (www.EducatedFranchisee.com)
- Kenneth S. Kaplan, General Counsel, Kaplan Franchise Group
- Lee Plave, CFE, Partner, Plave Koch PLC
- Additional sources include, but are not limited to, www.Webster.com and www.Wikipedia.com.
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I started this process after reading your book on franchising and realized how much I needed to learn. The process is motivating and fun! - Art, H. Illinois
The book is truly informative and details many of the steps and potential pitfalls associated with Franchising. Rick takes his time and makes this a Must Read! - George L., Kentucky