Often, the franchisee fee includes some assistance from the franchisor in opening the franchised business.
[2] In return, the franchisee may enjoy the use of the franchisor's system and name for a limited time, as well as assistance.
However, there are major franchise systems like Quiznos who received rebates from suppliers and did not pass along the cost savings to the franchisee.
Fees involved in acquiring and maintaining a franchise include: When buying a franchise a lump sum payment may be required, encompassing payment for the right to use a product, brand, and business model.
[3] Royalties are periodic payments, often paid monthly, for the continuing permission to use the franchisee's brand and products.