A franchise is a business between two parties whereby the franchisor provides the franchisee legal rights and licensed opportunity to offer a business in terms of name use, organization, training, recruitment, production, managing, distribution and marketing in return for a monetary fee. This monetary fee could be small or big, paid full or part and for a particular period of time depending on the agreement reached between both parties.
The franchisor is the original owner of the business looking to expand his business to other geographical areas and willing to give other businesses the right to use his/her business name. The franchisee is the business now having the licensed privileges of owning and operating a business based on the name (trademark) from the original owners. The advantages of a franchise business is that it provides your business with a well-known brand name, a proven structure of operation, trainings and market researches. It also has its disadvantage such as they are mostly expensive and involves huge capital to undertake.