Definitions

• Franchise - A right granted to a business by a company to use the company's name and sell or rent its products and service is called a franchise.
• License - A license grants permission to engage in a particular business activity.
• Product distribution franchise - The right to use a brand name and distribute a product is a Product distribution franchise.
• Business format franchise - The right to use a brand name and distribute a product plus the systems needed to operate the local business is a Business format franchise.
• Franchisor - The company that sells the right to offer its product or service to a businessperson is the franchisor.
• Franchisee - The businessperson who buys the right to sell the product or services of another company is the Franchisee.