People looking to invest in a digital marketing franchise – or any type of franchise – can find themselves catapulted into a completely new world. Not only is the world of franchising filled with jargon and new terms, but there are also many legalities and financial issues to sort out before you can rest assured that you are making the right decision when you invest in your chosen franchise.


Here is a quick overview of the terms you need to know about franchising:


  • Franchisor:

This is the franchising company that you are thinking of investing in. A franchisor is looking to expand its business by giving investors and business owners the opportunity to run their branded business in their chosen city or geography.


  • Franchisee:

This is the investor who wants to become a business owner of the chosen franchise.


  • Conversion franchise:

This is a business that decides to form part of the franchising company. Under the franchisor’s umbrella, the business will benefit from their brand and support systems. A digital marketing agency, for example, may decide to become part of a digital marketing franchise such as WSI. In this case, the digital agency is the conversion franchise.


  • Franchise fee:

This is the initial amount that you need to pay to become part of the franchise. Read your franchise contract carefully to make sure you know what it covers.


  • Royalty fee:

This is an ongoing fee that a franchisee needs to pay to the franchisor. Sometimes it is a percentage of your sales and other times it will be a flat-rate that is pre-determined and stipulated in the contract.


  • Protected territories:

Many franchisors have a protected territory agreement, which stipulates that another franchise will not open in your direct vicinity. This helps reduce the risk of franchisees competing with one another in a given suburb, city or province.


Are you interested in investing in a digital marketing franchise? Then get in touch with us to find out more about WSI, a leading global internet marketing franchise.