What is a franchise?

What Is a Franchise?

The word “franchise” is used to describe an arrangement in which one business, the franchisor, allows another business, the franchisee, to use its name, trademarks, trade secrets, intellectual property, branding, operating systems, and internal support resources in a specific geographic area, sometimes with an exclusivity provision that guarantees no other franchises will be granted within a specific buffer zone so the franchisees aren’t cannibalizing sales from each other, in exchange for some sort of payment.