“What is the difference between a franchisee and a company owned store within a franchise chain?” It appears that the biggest issue is ownership of the company or control of the business. There are benefits to both situations. A chain is a group of more than one store that sells the same products and has guidelines and rules set by corporate. A franchisee is considered, an outside investor, that invests own capital in order to use the recourses of the franchise system.
The corporate owned chain is responsible for the daily operations and benefits from profits or reversely shares in the losses. Each unit or store must follow all corporate policies set forth by owners, board, executives, etc. A franchise owner may have put up the money for the franchise but must still follow rules set forth by the parent company. Each owner must adhere to the types of products, the operating procedures, and follow set pricing standards establish. This is not much different than a company owned store’s guidelines.
Then the question considered, why would you buy a franchise? The answer is quite simple; a franchise is buying a proven system. When someone purchases a franchise, you are buying a proven product or service that has an established brand in the market. As a franchise owner, you do not need to reinvent the wheel from scratch. The business plan or model works. You are paying royalties to a parent company that has an established record.
A franchise is responsible for the success of the business. They also have a vested stake to loose, their investment. On the other hand, a manger is an employee of the company without an investment in the company but can loose their job. Becoming a franchise owner would be the next best thing to starting your on company. It has its on perks and flexibility.
http://smallbusiness.chron.com/chain-vs-franchise-188.html
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