Top Five Issues In Master Franchising vs Direct Franchising In Canada

Master franchising is often considered by foreign franchise systems as the ideal vehicle for bringing their system into Canada and by Canadian franchise systems as the preferred method of expanding their franchise system beyond Canada's borders. Under a master franchise agreement, the master franchisee is granted a large territory (for example, a province or even the entire country) with rights to sub-franchise the system and sell franchises (including sub-licensing the marks to franchisees) within its territory. This differs from the standard franchise relationship in which the franchisor typically directly grants the rights to a franchisee to operate its branded business at a particular location for the term of the franchise agreement.