We are a firm of specialist lawyers in distribution and franchise law.
Our work in the area of Franchises and Distribution, leads us to assist and advise, both judicially and extrajudicially, to numerous franchising companies and also franchisees, having been part of the Committee of Legal Experts of the Spanish Association of Franchisors and having carried out the Legal Advice of the Aragonese Association of Franchisors.
Our extensive experience has been rewarded internationally resulting in our office
lawyer chosen by Corporate INTL Magacine LEGAL AWARD 2010 in the category
"Office of the year in Spain in Right of Distribution and Franchising"
What is a franchise? Definition, types, advantages and disadvantages
Published in Autónomos y Emprendedor
, 07 - February , 2024 
Overview franchises
A franchise is a business model in which the exploitation of commercial rights of a brand is allowed in exchange for a certain amount of money.
In any case, although it may seem like an appealing business formula, before starting it it is advisable to know in depth how this type of business works.
1. WHAT IS A FRANCHISE
A franchise is considered a business model and commercial relationship between two parties. On the one hand, there is the owner of a brand (the franchisor) and, on the other hand, the entrepreneur (franchisee) who will pay to use said brand as a project. The latter is considered “entry fee.”
2. HOW A FRANCHISE WORKS
Let's start from the negotiation and payment for acquiring the franchise license. Once the project, premises or business is established, other monthly payments will be made. Said payment may be a fixed sum that has been agreed upon or a percentage of the profits obtained from the activity.
3. WHAT TYPES OF FRANCHISES EXIST
- Individual franchise
- Multiple franchise
- Regional franchise
- Master franchise
- Corner type
- Shop in Shop Type
4. WHAT ARE THE COSTS AND PROFITABILITY OFFERED TO A SELF-EMPLOYED INVESTING IN A FRANCHISE?
Advantages
- Less initial cost
- Less commercial risk
- Growth time
- It is an economy of scale:
- Less investment in advertising
Disadvantages
- You can't change
- Your voice is a minority
- You do not have freedom over communication
- You must be open to supervision:
- Amount of benefits
