What is a franchise

For clarity, the definition of Business Format Franchising as outlined by the British Franchise association is included below:

Business format franchising is the granting of a license by one person (the Franchisor) to another (the Franchisee), which entitles the Franchisee to trade as their own business under the brand of the Franchisor, following a proven business model. The Franchisee also receives a package, comprising all the elements necessary to establish a previously untrained person in the business and to run it with continual assistance on a predetermined basis (including a predetermined agreement length, with renewal options).

Additionally, the Franchisee has the opportunity to develop and grow a saleable asset that they can “realise” through the sale of their business to a purchaser, previously approved by the Franchisor.

In spite of continuing economic pressures on the economy as a whole, franchising in the UK continues to expand. This year we see:

A net increase rise to a total of 930 franchise systems in 2013, which represents an increase of 11% since 2008 – the beginning of the recession.
The total number of people employed in franchising is approximately 561,000 of which just under 50% are employed full-‐time
Contribution to the UK economy has increased by 2.2% to 13.7 billion. Contribution has grown by 20% since 2008 whilst the overall economy shrunk by 2.5% in the same period.
More than 4 in 5 franchisees 88% believe they have a competitive advantage (over other small businesses) as the result of running a franchised business and are expecting improved trading conditions.
Over the last few years, evidence has been examined as the impact of the economic downturn. Thus far, franchising has proven to be extremely resilient. There has been little evidence of widespread business failure and few signs of the business model breaking down.