Definition of Franchisor:
A franchisor sells the right to open stores and sell products or services using its brand, expertise, and intellectual property. It is the original or existing business that sells the right to use its name and idea. The small business owner who purchases these rights is called a franchisee and the branch business, itself, is called a franchise.
The franchisor company generally receives an initial start-up fee, an annual fee, and a percentage of the branch’s profits. It may also charge for other services. Well-known corporate franchisors include Hertz (HTZ), Marriott International (MAR), McDonald's (MCD), and Subway (privately held).
The company that allows an individual (known as the franchisee) to run a location of their business.
The franchisor owns the overarching company, trademarks, and products, but gives the right to the franchisee to run the franchise location, in return for an agreed-upon fee. Fast-food companies are often franchised.
How to use Franchisor in a sentence?
- All franchisors assume the risk that a franchise could fail.
- Becoming a franchisor is especially viable for already-successful companies.
- In order to expand their business, the franchisor must build several buildings and allow others to provide the upkeep and maintenance of said buildings so their franchise can flourish and prosper.
- If you want to expand your business you can look for a franchisor to open up another location and run it for you.
- Many fast food restaurants are owned by a franchisor which must follow the companys rules in order to maintain his status and ownership within the company.
- A franchisor sells the right to open stores and sell products or services using its brand, expertise, and intellectual property. .
Meaning of Franchisor & Franchisor Definition