Business Franchising is one way of expanding a business wherein a Franchisee buys a franchise from a Franchisor to get the right to create and sell the product or service of the Franchisor.
The two main individuals in franchising is the Franchisor and Franchisee. A Franchisor is the owner of the franchising business and the very first to try and took risk in building a successful business. He is the owner of the trademark of the business.
A Franchisee on the other hand is the individual or group that after conducting intensive study and investigation on the concept of the Franchisor's business will fund the buying or building of branch of the franchise business chosen by the Franchisor.
Aside from the Franchisor giving the Franchisee the right to use the trademark or trade name and the business format, the Franchisee is also being taught of practical details regarding the business. Included here are the right use of trade secrets, ways to run the business, servicing the customer, training the employees and national advertising. The Franchisee is being guided in starting, running and monitoring all the assets and operations of the business.