Webster's Dictionary defines “franchise” as 1. A privilege or right granted a person or a group by a government, state, or sovereign. 2. Authorization granted by a manufacturer to a distributor or dealer to sell his products.”
 
The word "franchise" comes from Old French meaning privilege or freedom. As economies evolved, so did the concept of franchising. It is believed that our current concept of franchising comes from the mid 1800s when a major German ale brewer granted certain taverns the exclusive right to sell their ale.
  
The definition of a franchise under federal law and most state laws regulating franchises defines a franchise as having 3 elements: (1) a shared trademark, (2) substantial control by or assistance from the franchisor, and (3) payment of a fee by the franchisee to the franchisor. The existence of these 3 elements may cause a business to be considered a franchise, even if it is called something else, such as a licensing arrangement or a distributorship.
  
The International Franchise Association (IFA), the major trade association in franchising, defines franchise as a "continuing relationship in which the franchisor provides a licensed privilege to do business, plus assistance in organizing, training, merchandising and management in return for a consideration from the franchise."
  
Franchising is a successful method of distributing goods or services to consumers. The franchise system owns the right to the trademark of the business. The franchisee purchases the right to use the trademark and operating system.
  
Most people associate the word "franchise" with fast food restaurants. But, there are many more types of franchise businesses, including everything from advertising to automobile repair, printing services to party supplies and many more.