Starting and running a business from scratch can be rewarding, but that doesn’t eliminate the risks involved. However, if you are an entrepreneur looking to leverage on existing business brands and models for profit as against creating a new business, running a franchise might be just the right venture for you.



According to business dictionary, it’s an arrangement where one party (the franchiser) grants another party (the franchisee), the right to use its trademark or trade name as well as certain business systems and processes, to produce and market a good or service according to specifications.

What this means in simple terms is that in exchange for a fee, a franchisee gains access to a business name or trademark (as the case may be), right of access to a franchiser’s business operating systems, as well as ongoing support as the venture commences operations.

Many reputable global brands operating within Nigeria, exists solely by reason of franchising.


The franchisee usually pays a onetime franchise fee plus a percentage of sales revenue as royalty in exchange for;

  1. Immediate name recognition.
  2. Tried and tested products (with little or no effort on the part of the franchisee).
  3. Standard building design and décor (where relevant).
  4. Detailed techniques in running and promoting a business.
  5. Training of employees.
  6. Ongoing help in promoting and upgrading of the products.



Franchising comes with a lot of benefits on the part of both the franchiser and franchisee.

On the part of the franchiser;

  1. The latter is enabled to enjoy his/her brand expansion with minimal overhead cost to the company.
  2. Franchising is an additional stream of generating revenue for the company.

On the part of the franchisee;

  1. The franchisee gains access to an already proven operating system as well as training on how to apply it.
  2. Access to an already existing customer base with little or no effort.
  • Access to an already established database of suppliers of materials needed for the goods or services you sell.

While venturing into franchising, the essence of a franchise agreement cannot be overemphasized. It is therefore strongly recommended that all terms of the franchise relationship, be reserved in writing for future reference.


Need help with setting up a franchise? We can help you.




Cynthia Tishion
Cynthia is a lawyer and currently serves as Head of Corporate / Commercial Services at LEX – PRAXIS. With her passion for business and entrepreneurship, she is actively engaged in creating awareness on the legal aspect of businesses through various platforms such as writing, public speaking engagements.

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