Starting a business from scratch can be overwhelming for first-time entrepreneurs. That’s why investing in an already successful franchise may be a good solution for your new business venture.
The original business owner (the franchisor) grants a license for the use of the trademark or trade name for a fee. The person who buys the franchise (the franchisee) is allowed to use the franchisor’s business name and operating system to set up the business. As a franchisee, you pay the franchisor a certain amount (royalties) from your franchise’s profits.