what is a franchise in business

A franchise is a business model in which an individual (franchisee) is granted the right to operate a business using the trademark, products, and business system of a larger company (franchisor) in exchange for an initial fee and ongoing royalties. The franchisor provides support and exercises certain controls over the franchisee's business, and the franchisee is responsible for serving the consumer. In the United States, a license becomes a franchise when three specific elements are in place: the franchisee's business is substantially associated with the franchisor's trademark, the franchisee pays an initial and/or continuing fee for the right to enter and remain in the franchise, and the franchisor exercises control or provides assistance to the franchisee