When a professional purchases a franchise, becoming a franchisee, he or she is investing in an enterprise that has pre-existing success as a chain. Therefore, the franchisee does not own the overall rights to the business. The franchisor will often help the franchisee get established by offering management training, marketing, and location selection services. In exchange for the use of the franchise name and product, the franchisee pays a percentage of his or her business profits back to the franchisor on a monthly basis.
Franchisees generally sign a contract that guarantees them business ownership for a period of 15 to 20 years, and contracts can be renewed depending upon the successful sales numbers of each individual franchise. Franchises are a good opportunity for people who want to go into business for themselves, but who do not have the previous knowledge or funding necessary to begin a new business. One of the greatest advantages of a franchise is that the brand is already established and recognized by consumers, making it easier to earn profits from the start.