1851

When we hear the term "<a href="https://www.youtube.com/watch?v=vZQ37LnwCrg&utm_source=1851franchise.com&utm_medium=article&utm_campaign=are-nfl-and-nba-teams-actually-franchises-2725150" target="_blank" rel="nofollow">franchise</a>," our minds often go to fast-food chains. They also might go to the NFL, NBA or other professional sports leagues, where the term takes on a slightly different meaning.&nbsp;While athletic teams are commonly referred to as "franchises," their structure and operation differ significantly from traditional business franchises like&nbsp;<a href="https://1851franchise.com/franchise-deep-dive-mcdonalds-franchise-costs-fees-profit-and-data-2720737#most-recent-stories">McDonald’s</a>. Here’s how.&nbsp;<h3>The Unique Nature of Sports Franchises</h3>The term "franchise" typically refers to a contractual agreement in the business world, but its application in professional sports is a little different. Here are the key components of a&nbsp;<a href="https://www.managementstudyguide.com/sports-league-franchise-agreement.htm?utm_source=1851franchise.com&utm_medium=article&utm_campaign=are-nfl-and-nba-teams-actually-franchises-2725150" target="_blank" rel="nofollow">sports league franchise agreement</a>:&nbsp;Professional sports teams operate a bit differently from regular franchises owned by individuals or companies. Instead of one person calling all the shots, these teams have multiple owners who collaborate. They're often called "members," and they work together to make decisions that affect both their own team and the entire league.These teams follow a set of rules established by their respective leagues, like the NFL, NBA or MLB. These rules cover everything from daily operations to player contracts, ensuring fairness for everyone involved.These franchisees also have their own territories, explaining why certain teams represent a city or area. It's their designated area, and no other team from that same region can join the league. For example, if you have the Chicago Bulls in the NBA, no other team from Chicago can compete in the league.The big leagues also make commitments to team owners. They have to uphold certain promises, like ensuring there are enough teams to play, distributing top players evenly among teams, and promoting the league. They also handle tasks like scheduling games and obtaining event permissions.And just like any agreement, there are rules for what happens if things go wrong. Sports franchise agreements outline what constitutes breaking the rules and the consequences that follow.Unlike regular businesses where each owner keeps their profits, sports teams often share their earnings among all the teams in the league. This ensures financial fairness and equal opportunities for every team. Financial management is important for sports teams too. They follow a set of rules for handling finances, ensuring accuracy and transparency.When it comes to making money from the team's name and logo, there are clear rules. The agreement specifies who can sponsor the team and what types of businesses they can partner with, aligning with the league's image.As for a team's identity, things like logos and trademarks are crucial, and the agreement ensures clarity on ownership. This helps prevent disputes over usage rights.So although NFL and NBA teams are often called "franchises," they're clearly quite different from the regular business franchises we know and love.&nbsp;Interestingly, NFL and NBA players&nbsp;<a href="https://1851franchise.com/athletesinfranchising">have often been known</a> to cross into the other realm of franchising. To learn more about that, check out these related articles:&nbsp;<ul><li><a href="https://1851franchise.com/shaquille-oneal-the-renaissance-man-of-franchising-2720841">Shaquille O'Neal: The Renaissance Man of Franchising</a></li><li><a href="https://1851franchise.com/what-franchises-does-peyton-manning-own-2720856">What Franchises Does Peyton Manning Own?</a></li><li><a href="https://1851franchise.com/what-franchises-does-magic-johnson-own-2720863#franbuzz">What Franchises Does Magic Johnson Own?</a></li></ul>

Are NFL and NBA Teams Actually Franchises?

Understanding the Structure of Sports Franchises

1851 Franchise

Though professional sports leagues are referred to as franchises, the term takes on a different meaning for the NFL and NBA than what we’re used to. 

are-nfl-and-nba-teams-actually-franchises

TruBlue Home Service Ally

TruBlue Home Service Ally Celebrates Major Milestone With Opening of Its 100th Franchise Location

trublue-home-service-ally-celebrates-major-milestone-with-opening-of-its-100th-franchise-location

Children's Lighthouse

Children’s Lighthouse Named Among the Top Franchises in Entrepreneur Franchise 500® Ranking

Children’s Lighthouse Named Among the Top Franchises in Entrepreneur Magazine’s Franchise 500® Ranking

childrens-lighthouse-named-among-the-top-franchises-in-entrepreneur-magazines-franchise-500-ranking

Layne's Chicken Fingers

Four Layne's team members stand in front of a wall decorated with artwork from the community

The Easiest $10,000 Made in a Day: How Layne’s Built Operations for Volume

the-easiest-10000-made-in-a-day-how-laynes-built-operations-for-volume

Pet Wants

Why Pet Wants Is Perfect for First-Time Franchise Owners

why-pet-wants-is-perfect-for-first-time-franchise-owners

Griswold

7 Winter Safety Tips for Seniors: Staying Safe During National Winter Safety Month

7-winter-safety-tips-for-seniors-staying-safe-during-national-winter-safety-month

Buying a Franchise Masterclass

 Franchise Opportunities

Get Support Buying a Franchise

How to Buy a Franchise White Paper

How to Buy a Franchise

How to Sell Franchises

How to Grow a Franchise

Find a Franchise Supplier

1851 Franchise Opportunities

Franchisor News

Franchisor Power Rankings

FranCamp Mastermind Summit

Franchise Resources

What ALEC-Laffer's Report Means for Franchising

Website Awards

Power Rankings

About 1851

Advertise on 1851

Contact 1851 Editorial

Terms of Use

Login

facebook

instagram

twitter

linkedin

youtube

Yum Brands - KFC - Pizza Hut - Terminates Franchise Agreements in Turkey - 1851 Franchise

Yum! Brands Terminates Franchise Agreements in Turkey Due to Non-Compliance

yum-brands-terminates-franchise-agreements-in-turkey-due-to-non-compliance

Recent Franchise News - Why Franchisors Churn Through Marketing Suppliers - 1851 Franchise

Forbes: Four Reasons Why Franchisors Churn Through Marketing Suppliers

forbes-four-reasons-why-franchisors-churn-through-marketing-suppliers

QSR Magazine: Big Chicken Targets Global Expansion

qsr-magazine-big-chicken-aims-for-global-growth

Starbucks Strike Brews Opportunity for the Next Coffee Franchisee

starbucks-strike-brews-opportunity-for-coffee-franchise-hopefuls

I Heart Mac and Cheese - Franchisees Sue I Heart Mac and Cheese - Franchise News - 1851 Franchise

Restaurant Business Online: Franchisees Sue I Heart Mac and Cheese

restaurant-business-online-franchisees-sue-i-heart-mac-and-cheese

Two Attorneys, Restaurant Professionals To Serve Germantown Community With New Paris Baguette Café

two-attorneys-restaurant-professionals-to-serve-germantown-community-with-new-paris-baguette-cafe

Top 10 Franchises for New Year’s Resolutions

Top 10 Franchise Opportunities for New Year’s Resolutions

top-10-franchises-for-new-years-resolutions

Leveraging Technology in Franchise Management

How to Leverage Technology in Franchise Management

leveraging-technology-in-franchise-management

The Best Franchises To Own With Low Initial Investments

best-franchises-with-low-initial-investments

Newk's Eatery - Magee, MS - Skip Russell Franchisee Profile - CI

Former Popeyes Franchisee Builds on Decades of Success with Newk's Expansion Plans

former-popeyes-franchisee-builds-on-decades-of-success-with-newks-expansion-plans

Are NFL and NBA Teams Actually Franchises?

MORE STORIES LIKE THIS