Tag Archives: ActionCoach

Why Subfranchising is Rare in the U.S.

Subfranchising is one of three multi-unit franchise structures that the North American Securities Administrators Association, Inc. (NASAA) addressed in their Multi-Unit Commentary, which was the subject of an earlier post.  The other two types of multi-unit franchise offerings discussed in that post are area development and area representative. Of the three multi-unit approaches, the subfranchise is by far the least commonly used in the U.S.  And with good reason. In subfranchising, the franchisor appoints a master franchisee who has the right and obligation to sell subfranchises within a defined territory.  The agreement between the franchisor and the master franchisee is called …

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