What Is A Franchise And The Origin Of It\\\\\\\'s System?

Franchise business is a system whereby a franchiser grants the franchisee the right to use the trademark or patent, associated with the exclusive right to distribute or semi-exclusive to products or services and possibly also the right to use the technology of implementation and business Administration or operating system developed and owned by the franchisor, through direct or indirect remuneration.

TERMS USED IN THE FRANCHISE SYSTEMS

Franchiser: Is the entity that authorizes others (the franchisees) to make limited use of a mark whose rights are involved. In more advanced systems, are also broadcast standards and knowledge necessary for successful operation of the business. The knowledge imparted allows a franchisee to deploy, operate and manage their own business.

Franchisee: The person or entity who purchases a franchise.

Franchise: A unit of a given network.

Territory: Geographical area of operations determined in a franchise contract between the parties, with a guarantee of exclusivity or preference of the franchisee.

Royalties: Remuneration paid to the franchisor and the franchisee in return for the transfer of the franchise rights to the franchisee.

Advertising Fund: A fund in which all franchisees contribute to a given network specifically for enabling of marketing and advertising network that are common to all. This fund is administered by the franchisor, and may also have the participation of representatives of the franchisees.

Franchise Offering: Document required by the law of franchises. It should contain all necessary data and information to the prospective franchisee to analyze the investment opportunity in a particular franchise.

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