Even though it usually appears under ownership, franchising is not a form of ownership, but a form of organisation. A franchise may be owned as a sole trader, partnership, co-operative or private or public limited company. It is, however, a very popular way for people to get into business.
A franchiser will sell a franchisee the right to sell its goods or services. The sale usually involves a fixed fee (which can be very high) and a percentage payment of the franchisee’s sales turnover (called a royalty). McDonald’s is an example of a franchiser as they let other people (franchisees) open McDonald’s restaurants in return for a fee and a percentage of the money made from sales. (McDonald’s also operate a number of burger bars themselves). Other examples of franchises are Snappy Snaps, Kall Kwik, Benetton and the Body Shop.