Home Solutions Institute

A Personal Franchise is a legal and commercial relationship between the owner of a trademark, service mark, trade name, or advertising symbol and an individual or group wishing to use that identification, products or services in a business.

Each personal franchise business (franchise) has been authorized by a parent company (franchisor) to sell their goods and/or services within a given set of parameters. The company defines the method of conducting business between the two parties. Some structures are very defined and others are more liberal. Generally, a personal franchise sells goods or services supplied by the company. This relationship is regulated by FTC laws.

The popularity of the personal franchise business model has to do with the ease in becoming a business owner. Independent, non-franchise businesses have a much higher likelihood of failure within their first year than true personal franchises. One of the most compelling reasons is that, in a personal franchise operation, the company and business team provides business expertise (marketing and advertising plans, management guidance, financing assistance, administrative support and training) that otherwise would not be available to businesses starting from scratch. The personal franchise brings to the relationship entrepreneurial spirit and drive, which may not be enough to keep a business afloat if the franchisee lacks significant business knowledge.

This allows the franchise to operate by different methods or in different types of locations giving individuals a great deal of flexibility. They can be operated through the home, in RV’s, apartments, assisted living facilities, office building or work-live spaces that are now becoming popular. If used properly while living and working – you can deduct many expenses that might not have been deductible.

Many of the personal franchise opportunities use the old multilevel marketing compensation systems to compensate the personal franchises and are still considered MLM’s by some. What are the differences between a MLM and a personal franchise then? It depends on how you run the business and if you can run the business as a separate entity.

Many of the traditional MLM’ers didn’t run their business as a business, selling product to customers, but rather spent their time trying to “get others” into selling their products. Many have been unintentionally educated to become very annoying in the process.