Explained: Roles of Franchisor and Franchisee Defined

As an industry, there are times when we need to return to the basic understanding of franchising and how the roles of franchisor and franchisee interconnect. This helps us accommodate the many first-timers, just learning about becoming their own boss through franchising. For them, just knowing the roles in the franchise world is half the battle in planning for franchise ownership. Whether you’re interested in buying a franchise or franchising your business, it’s pivotal to understand the inner workings of our industry structure.


Without a clear understanding, a prospective franchisee might think of a franchisor as a “boss.” However, this is not the case at all. The success of franchising is equally interdependent on both parties. The franchisor, or brand, is heavily invested in each of their franchisee’s growth and profitability. When a franchisee is able to freely collaborate with the franchisor, the probability of success skyrockets.

Let’s go over these two roles in a little more detail. As well as setting expectations for both sides of the franchise ownership equation…


The “franchisor” is an individual or company who own the trademarks and business models for a franchised concept. The franchisor allows the franchisee a license to use the name and business model concept in exchange for a fee and recurring royalties. Thus, the “franchisee” is the individual or group who owns, oversees, and performs the daily operations of the franchise. The franchisee is the owner of their own business; however, they are expected to follow the business model of the franchisor to the letter of the law.

What Franchisees Can Expect

Franchisors aren’t in business to sell the rights to open a new franchise location to anyone with a checkbook. Although adequate funding is a necessity, it takes much more consideration and investigation to determine if a franchisee candidate will become a successful owner. Franchisees who want to succeed must have a strong work ethic, a thirst for new knowledge, an adaptable and teachable nature, and values which align with the franchisor and the business model. The franchisee must also have formal training and ongoing support to run a viable business on behalf of the franchisor. The franchisee is also responsible for hiring and managing their staff, local marketing, and promotions, and setting a smart price point for their location – all within the carefully constructed parameters set forth by the franchisor.

What Franchisors Do

It’s the job of the franchisor to set up territories in such a way as to prevent rivalry among its own locations – while still serving and reaching as many customers as possible. While it seems easy to assume that larger cities mean more successful franchise locations, this isn’t always true. For this reason, and others, franchisors determine locations and territories with the best possible chance for prosperity. And franchisors continually provide ongoing training and support materials to their franchisees. Training and support are vital to ensure consistency throughout the various locations of the franchise.

A Harmonic Balance

Starting a franchise doesn’t necessarily equate to overnight success. As with any business startup, a new franchise requires work and determination. Establishing a new business is an incredible amount of work, no matter how you cut it. But, bearing that in mind, there are many advantages to business ownership through franchising. As a franchisee, you have a roadmap of success to follow, and a great deal of support built into your operation. You’ll have the freedom to run your own business, with the added support and collective wisdom of the franchisor. The roles of franchisor and franchisee are built upon a harmonic balance. But when franchisor and franchisee do work together in a harmonious relationship, both parties get the mutually beneficial opportunity to succeed.

If you’d like to explore whether or not franchising is a fit for your business ownership dreams, perhaps it’s time to begin an entrepreneurial journey of your own. FranNet can help you get started today by setting up a no-cost, no-obligation appointment with a qualified FranNet representative who both lives and works in your area. Together, we can find a franchise ownership opportunity that matches up perfectly with your lifestyle and income-oriented goals.

Mar 3, 2022