There is widespread confusion about an aspect of franchising and licensing which is caused by the difference between the laws in the USA and the UK. So, I will be clearing up the confusion that I see in many articles online.

• Franchising is a way to scale a business once the business model is successful and proven
• A franchise agreement will usually give the franchisor the ability to control how the business is run
• The franchisor is expected to provide support to its franchisees in the form of marketing, access to trusted suppliers, systems, and other resources and skills
• Franchising a business involves finding franchisees with the necessary skills and experience to operate branches of the same business
• Licensing is essentially how you exploit intellectual property
• Franchising is a type of licensing arrangement
• The details of the terms and conditions in a licensing agreement will vary considerably depending on the business transaction you’re aiming to achieve
• Before you embark on licensing it’s essential to ensure you have the necessary intellectual property rights in place
• Another example of how licensing can be used involves giving access to your methodology for doing something
• Using the wrong terminology, such as giving an exclusive licence to someone can destroy the owner’s rights to exploit its intellectual property

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