Businesses that are seeking to expand their geographical reach and market share may decide to franchise their products or brand names. Franchises are joint ventures between a franchisor and a franchisee. The franchisor is the original business that has created a product or service and sells the rights to the name, idea, and business model to another business. The franchisee then purchases the right to sell the franchisor’s goods and services under its existing business model. A franchise has several advantages and disadvantages.
Costs of starting a franchise
In addition to initial fees, there are ongoing fees and royalties associated with operating a franchise. Because franchisors spend money marketing their brand, you will be expected to pay a monthly marketing fee that is a certain percentage of your franchise’s monthly revenue. In other words, if you make US


