Home · Encyclopedia · Sub-franchisee
The parties involvedSub-franchisee
A partner who receives rights from the master franchisee rather than directly from the original brand owner.
Definition
A partner who receives rights from the master franchisee rather than directly from the original brand owner.
Where this sits
A franchise system involves several distinct roles. Naming each role precisely avoids misunderstandings about rights and obligations in the agreement.
Related terms in this topic
Master franchiseeThe partner granted rights to develop the brand across an entire country; they open their own units and act as a sub-franchisor recruiting and supporting local partners.
Area developerA partner committing to open an agreed number of outlets within a territory on a set schedule, but usually without the right to sub-franchise to third parties.
Multi-unit franchiseeA partner owning and operating several outlets of the same brand, typically gaining scale efficiencies in management and supply.
Single-unit franchiseeA partner operating a single outlet — the most common form and the starting point for most systems.