📚 Franchise Basics
Understanding the fundamentals of the franchise business model.
What Is a Franchise?
A franchise is a business model where one party (the franchisee) pays another (the franchisor) for the right to operate a business using the franchisor's brand, systems, and support. In exchange, the franchisee pays an initial franchise fee and ongoing royalties, typically a percentage of gross revenue.
How Franchises Make Money
Franchises generate revenue through multiple streams for both franchisors and franchisees. Understanding these economics is critical before investing.
Franchise vs. Independent Business
Both paths have merit. The right choice depends on your experience, risk tolerance, capital, and goals. Here is an honest comparison.
Types of Franchise Models
Not all franchises are structured the same way. Understanding the different models helps you choose the right path for your goals, capital, and risk tolerance.
Last updated: May 2026