Legal Definitions - franchise agreement

A franchise agreement is a legal contract between a franchisor and a franchisee. The franchisor is the owner of a business or trademark, and the franchisee is someone who wants to operate a business using that trademark. The agreement gives the franchisee the right to use the franchisor's trademark and business model in exchange for payment.

• McDonald's is a famous franchise. If someone wants to open a McDonald's restaurant, they would need to sign a franchise agreement with McDonald's. This agreement would give them the right to use the McDonald's name, logo, and business model.
• Another example is 7-Eleven. If someone wants to open a 7-Eleven convenience store, they would need to sign a franchise agreement with 7-Eleven. This agreement would give them the right to use the 7-Eleven name, logo, and business model.

These examples illustrate how a franchise agreement works. The franchisor owns a successful business or trademark, and the franchisee wants to use that success to start their own business. The franchise agreement allows the franchisee to use the franchisor's name, logo, and business model in exchange for payment.