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A restaurant becomes a franchise when its owners decide to license their branding and operational model to other entrepreneurs, who open, own and manage their own restaurants with the brand.<a href="https://www.mcdonalds.com/us/en-us/about-us/franchising/franchising-faq.html?utm_source=1851franchise.com&utm_medium=article&utm_campaign=what-does-it-mean-for-a-restaurant-to-be-franchised-2715090#:~:text=How%20much%20is%20a%20McDonald's,be%20paid%20to%20the%20franchisor." target="_blank" rel="nofollow">McDonald’s</a> is perhaps the most well-known example of a franchised restaurant. Most McDonald’s are owned not by the McDonald’s corporation, but by entrepreneurs — or, franchisees — who handle the day-to-day operation of their stores while the larger corporation — or, franchisor — provides operational guidance, marketing support, vendor contracts and other resources.&nbsp;When a restaurant is franchised, it means the business model has proven sturdy enough to succeed on its own, without the hands-on guidance of its original founders or owners. McDonald’s has established a brand name, reputation and processes of service that make it profitable to own and easier to launch than an entirely new brand, which is worth a lot of money to investors.&nbsp;<h4>Difference Between Chains, Franchises and Independents</h4>Chipotle, on the other hand, is a chain restaurant, meaning every single Chipotle location is owned by the Chipotle Mexican Grill corporation. Consumers likely don’t notice the difference between chain and franchise restaurants, as both McDonald’s and Chipotle stores have a unified look and similar offerings across locations.&nbsp;Unlike chains, franchised restaurants have greater flexibility in how they staff their stores and engage with their communities. Usually, a franchised business is owned by a local entrepreneur with ties to their geographic location. It’s much more likely that a franchised restaurant would support a local softball team, for example, than a large corporation.

What Does It Mean for a Restaurant To Be Franchised?

1851 Franchise

Restaurants fall into three broad categories: independents, chains and franchises. 

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Famous Dave's

Famous Dave’s Rolls Out Smaller Prototype To Expand Access and Lower Costs for Franchisees

Franchise Times: Famous Dave’s Rolls Out Smaller Prototype To Expand Access and Lower Costs for Franchisees

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Strategic Franchising

Are You Ready for Franchise Ownership? Self-Assessment Checklist

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Pet Wants

New to Franchising? Here’s Why Pet Wants Is a Great Place to Start

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Understanding the Franchise Fee: What It Covers and Why It’s Worth It

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Right at Home

NorthcentralPa.com: Right at Home Targets Expansion in State College, Pennsylvania

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Pizza Hut - EYM Group - Chapter 11 Bankruptcy - 77 Pizza Hut Locations Sold - 1851 Franchise

77 Pizza Hut Locations Sold After Franchisee Bankruptcy Filing

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Jersey Mike's - Blackstone - Global Growth - 1851 Franchise

Jersey Mike’s Ramps Up Global Growth Following Blackstone Acquisition

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Layoffs Surge to Pandemic-Era Highs, Opening Doors for Franchise Growth

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FAT Brands Becomes First Restaurant Franchise To Accept Bitcoin for Royalty Payments

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Yum! Brands CEO David Gibbs To Retire in 2026 After 36 Years With the Company

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Paris Baguette Ranks Among Top Franchises on Entrepreneur’s Franchise 500® for 2025 - 1851 Franchise

Paris Baguette Ranks Among Top Franchises on Entrepreneur’s Franchise 500® for 2025

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1851 Agg - McDonald's Sales Decline Expansion Continues - 1851 Franchise

McDonald’s Franchisees Feel the Pressure as Sales Decline and Expansion Continues

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Tariff Tensions Threaten U.S. Restaurants with Rising Costs and Supply Chain Disruptions

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Florida Franchisee Reflects on Success and Growth with Sylvan Learning

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Franchisee spotlight graphic with photo of Amanda Moore and USA Ninja Challenge logo

Neonatal ICU Nurse’s Passion for Caring for Children Led Her to Franchise With USA Ninja Challenge

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Franchisee spotlight image with Randy and Sandy Craft, Children's Lighthouse logo on blue background

The Crafts’ Successful Journey from New Parents to Children’s Lighthouse Franchisees

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Lindora’s New President Discusses Franchise Growth and the Future of Health and Wellness

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Military Veteran and Craft Beer Enthusiast to Bring Voodoo Brewing Co. to Toledo, Ohio

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What Does It Mean for a Restaurant To Be Franchised?

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