Definition of a Business Format Franchise

Definition of a Business Format Franchise

For a business to be considered to be a offering a genuine franchise opportunity it has to meet the criteria of being a genuine Business Format Franchise. The following defines the characteristics of such a business.

  • The Franchisor should have registered, protected and secured the Intellectual Property Rights in relation to their brand.This , then provides them with the legal right to allow others to use their registered trade or service mark.
  • The people investing in the opportunity must trade under the Franchisors brand and not have flexibility to chose another trading name or style.
  • The Franchisor provides initial training identifying the methods to be used in promoting the products and/or services. The Franchisor benefits from the ongoing activity of the people investing into the opportunity by way of a Management Services Fee, Royalty or supply of products and services with a mark-up.