Posted in Operations and Supply Chain Terms, Total Reads: 1403

Definition: Franchise

It is a word to explain the privilege or right to use any product or service. In business terms it can be said as giving the operational rights to use the trademark or brand.

For example brand like addidas, levisetc works on this principle in which the business is expended by having presence in multiple markets. Since for a firm it becomes difficult to operate and manage too many store on their own they follow this methos of franchise. The franchise give a licence to the franchiser to operate and manage the service within the terms and condition and franchiser who takes this ownership has to pay to the franchise i.e. the owner of the service or brand as per the specified terms and condition.

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