Franchise vs.
Business Subscription
The Differences Between Being a Franchisee and a Business Subscription
There are many options when starting a business. One option we constantly hear about at EnVie Fitness (probably because we were one), is buying into a franchise system. That means you pay a business to use their business model and operate under their name. An alternative to a franchise is a license. In licensing, you purchase the rights to the brand and you operate as you see fit. At EnVie Fitness, we have created a Business Subscription, which we think of as a version of a license, with a focus on your success.
There are a number of differences between franchising and licensing. But not as many differences between licensing and a business subscription.
The most basic difference between a Licensor and a Franchisor is the level of responsibility owed to a franchisor versus that owed to a licensor. Other differences are below. If you have more questions, please contact us and a member of our team will be happy to walk you through the differences.
Contracts
Licensee: Cancellable with notice.
Business Subscription: Subscription that can be cancelled.
Franchisee: Becoming a franchisee means you will sign a long-term contract (Franchise Agreement) and you will be held responsible to the terms of that agreement for the entire duration of the agreement (usually ten years). If something were to happen where you are no longer able to perform your obligations in the agreement, you would have the option to pay the franchisor to exit the agreement or request permission to sell your franchise to another person (so long as the franchisor approves that person).
Rules
Licensee: Follow brand guidelines and create a women’s fitness program.
Business Subscription: Follow brand guidelines if you use them, create a program of your own using the resources available in the subscription.
Franchisee: Follow the Operations Manual (a document that can change at the discretion of the Franchisor). Failure to follow the operations manual will result in financial penalties.
Cost
Licensee: The price is set by the licensor, and can include requirements that may require additional spending.
Business Subscription: Monthly or Annual Subscription.
Franchisee: The price you are told does not include the monthly fees, renewal fees, marketing fees, special purchases, fines, and a long list of other possible fees listed in the Franchise Disclosure Document (Item 5 and Item 6).
