
Ad Fund Contribution
An ad fund contribution is a monthly marketing payment to the franchisor. Most buyers forget it, and then pay for local marketing twice.
Plain-language definitions of the franchise terms you'll come across while researching opportunities.

An ad fund contribution is a monthly marketing payment to the franchisor. Most buyers forget it, and then pay for local marketing twice.

COCO means the brand pays for, owns and runs the outlet with its own staff. You cannot buy one, but its own outlets show whether the model works.

Exclusive territory rights stop the brand from opening near you. Most Indian clauses are weaker than they look. What to check before you sign.

FOCO means you fund and own the franchise outlet, but the brand runs it day to day and pays you a share of what it earns.

FOFO means you own the franchise outlet and run it yourself, while the brand supplies its name, systems and rules. It is the most common model in India.

A franchise fee is the one-time payment for the right to open under a brand. What it covers, whether it is refundable, and the tax on it.

A master franchise is the right to develop a brand across a territory and sub-franchise it. What it costs you, and what to check first.

A royalty fee is an ongoing payment to the franchisor, usually a percentage of sales. The base it is charged on matters more than the rate.