The Characteristics of a Franchise

by Cate Julia; Updated September 26, 2017

Many small businesses in the United States are franchises. Franchises appear in many industries like real estate, fast food, hotels and retail. Some popular franchise brands include McDonald's, Marriott Hotels and Century 21.

Types

According to the International Franchise Association, there are two types of franchises. These are product distribution and the business format.

Features

Product distribution franchises get use of a franchisor's trademark and logo to sell products. Most franchises are business format, which provides products and methods to run the business.

Function

Franchisors offer financial, marketing, and training support to franchisees to help them grow their business in exchange for fees for using the franchisor’s trade name and business model.

Benefits

Franchises help a business owners be in business for themselves without starting a business from the ground up.

Considerations

Purchasing a franchise can be expensive, consider the pros and cons of franchise ownership before making a purchase.

About the Author

Cate Julia has been a freelance writer for over five years. She has a B.A. in English from the University of Maryland, a M.A. in liberal arts from Johns Hopkins University and a Master of Library and Information Science from Florida State University. Her work has appeared in the "Greenwood Encyclopedia of African American Literature" and the "Encyclopedia of American Race Riots."