In some franchise agreements, the franchisor charges a license fee or some other charge to use the logo, trademark, or copyright. This fee is assessed because it is possible that the franchisor has to pay some third party for the right to use the trademark, logo, patent, or copyright in the franchise system. In rare situations, the franchisor is merely a clearinghouse or territorial controller for the franchise network and therefore, this fee pays for the territorial grant.
The primary reason for the franchise arrangement is the increased net profit for the franchisee in using the franchiser’s name, logo, brand, or trademark. The franchiser charges an upfront fee called a Franchise Fee, monthly […]