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Franchising from the Franchisor’s Perspective: Legal and Commercial Advantages, Disadvantages and Practical Considerations - Checklist

Published by a LexisNexis Commercial expert

Checklists

This Checklist examines the pros and cons of adopting a franchising model from the franchisor’s viewpoint. Franchising attracts steady attention as a route to market, but would-be franchisors should assess carefully whether it suits their particular operation. Below is a summary of the advantages and disadvantages of franchising from the franchisor’s standpoint.

Advantages

Franchising is a well-established route for scaling a business, with numerous high-profile success stories, including pizza brands, hotel groups and mobile phone shops.
Many high street banks may extend favourable lending to franchise businesses, as they can be perceived as presenting lower risk than alternative models.
The franchise approach can demand far fewer staff than a centrally owned network, as the owner does not need to open and run multiple outlets.
The franchisor can apply franchisees’ fees to fuel growth and lessen debt. These fees provide a key, predictable annual income stream and, in some cases, their total can meet operating expenses.

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Web page updated on 20/05/2026

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