Defining Franchising

Defining Franchising

FC Business Solutions - Tuesday, May 03, 2016

The Definition of Franchising

In basic terms franchising is defined as a legal and commercial relationship between the owner of a trademark, services mark, trade name or advertising symbol and an individual or group wishing to use that identification in a business. Franchising is an extremely successful and proven method of distributing goods and services in Australia.

The franchising industry in Australia is rapidly growing, generating approximately $175b of revenue across 1,175 businesses in 2015/2016. (IBISWorld 2015)

So how does franchising work?

There are four main elements to any franchise system:

  1. The Brand

The brand associated with the services delivered in a memorable and satisfying experience to the customer.

  1. Operating System

The operating system takes the excellent service delivered from one location and replicates the experience in each and every franchise location.

  1. Support System

The support system helps the franchisee get better and better at delivering the services in a memorable experience which ultimately improves the franchisees performance.

  1. Franchisee

The franchisee provides the talent, the motivation and the passion to the franchise system.

Advantages of Franchising

Good franchising will always be a win-win situation for the franchisor and franchisee:


  • Rapid expansion of the business
  • Having the right people within the business
  • Franchisee operated locations statistically perform better than company owned locations


  • Reduced risk – purchasing into an established brand rather than starting from scratch
  • Franchisees are provided with support services such as marketing, human resources, business development, etc.
  • It’s easier for a franchisee to obtain finance

These are only some of the advantages of being a part of a franchise system. Read our other blogs for more specific articles on each aspect of franchising.

Are you looking to franchise your existing business?

FC Business Solutions offer a wide variety of franchise support services varying from system development, recruitment strategy and operations manuals. Contact FC Business Solutions to see how we can help grow your business into a national franchise system.


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