How Franchising Works

How Franchising Works

Understanding how franchising works might take some time. Plus, each franchise has their own way. But essentially, if you enter a franchise agreement you pay for using their business name and processes, and agree to use those things correctly in exchange for owning a business.

What Is Franchising?

To franchise something, the company allows buyers to essentially license the name, buy the tools at wholesale prices, and to market the business with their profitable stratigies. A franchise can be a bricks-and-mortar business, an online business, or even a particular process of doing business such as some types of marketing solutions.

Advantages of Franchising

The advantage of franchising is that if you do the right research and choose well, failure is less likely. The reason is that the business systems have been tested. All you must do is take the training and follow it. When you’re unsure, you’ll have people to talk to about ideas and ways to do better. Some studies show that a legitimate franchise has a 95 percent success rate.

Disadvantages of Franchising

While you’re considered an independent business, you’re still working for people who are like bosses. You’ve entered a legal agreement with them to run the business the way that they dictate that you run it. And due to this, your business relates to all the other franchises. So if one person does something that makes the news, it could affect your business negatively.

Franchising Fees

There are a lot of different fees outside of the charge for buying into the franchise, which is payable upon signing the contract. But then you’ll have ongoing fees that you are required to pay to use the company trademarks and receive business support. Plus, you will be responsible for royalties that may be as high as 6 percent of revenues. Don’t forget other costs such as build-out, business filing fees, supplies, and so forth, however most are covered in the initial franchise fee.


Many people do not realize that most franchising buy-ins are for 5 or 10 years. At Pop Up and Paint, we offer flexible franchising that allows you to go month to month or even short term. It’s going to be up to you to resign or transfer from the franchise, which may require more fees but if you can transfer your agreement to another buyer, your cost may be waived or covered.  You must follow the standard operating procedures given to you by your organization as they have a proven successful method for your business to succeed. There may even be limits about when you can sell the franchise to others, and who you can sell it to as the agreement can vary in terms. For example, what may be in agreement at a price point for you in one city or state may not work for someone else in a different city or state.

Selecting the Right Franchise for You

To select the right franchise for you, it’s important to understand your own skillset, interests, and even physical and mental capabilities before making your choice. You don’t need experience or business experience, but you do need the ability to do what the job entails. When choosing, be sure that you can really do this long term. For example, if you’re interested in entertainment you might want to look into a paint party franchise such as Pop Up and Paint.


One thing a lot of people don’t know is that owners don’t always use the term “franchise” to describe their business opportunity – even if that’s exactly what it is. A franchise is determined by a few actions such as association with a trademark, payment of a fee, following certain marketing plans and so forth.

For example, is really a franchise; they don’t call themselves that, but anytime someone teaches you a system, and you’re allowed to use the system and you pay a fee for using that system, it’s really a franchise.


There are a lot of businesses that you go to regularly that are franchises. For example, a super well-known franchise is McDonald’s. There are also some lesser-known franchises such as Budget Blinds and Primrose Schools. You may be surprised that a lot, if not most, of the businesses available for investment and you go to daily are franchises.


If you want to find a Pop Up and Paint franchise plan that is right for you and your budget, the best thing you can do is schedule a call to learn more about how you can benefit and receive financial support to get started on earning income operating your own business with a proven profitable business model.