- ACCC
- The Australian Competition and Consumer Commission. The federal regulator that enforces the Franchising Code of Conduct.
- Area Developer
- A franchisee who commits to opening multiple venues across a defined territory over an agreed schedule. Sits between a single-unit franchisee and a master franchisee.
- Code of Conduct
- The Franchising Code of Conduct. Mandatory industry code under the Competition and Consumer Act. Updated 2024.
- Cooling-off period
- 14 days after signing a franchise agreement during which the franchisee can terminate and recover most payments. Set by the Code.
- Disclosure Document
- The prescribed document a franchisor must give a prospective franchisee at least 14 days before signing. Contents are set by the Code.
- FCA
- The Franchise Council of Australia. The industry's peak body for franchisors, suppliers and advisors.
- Franchise Agreement
- The contract that governs the franchise relationship. Distinct from the Disclosure Document.
- Franchisee
- The party that operates a venue under the franchisor's brand and system. Buys the right to do so.
- Franchisor
- The party that owns the brand, the system, and grants franchise rights to franchisees.
- Good faith
- Statutory obligation owed by both parties under the Code, in negotiation, performance and dispute. Real, enforceable, not platitudinous.
- Information Statement
- The Code-mandated plain-English summary of franchise risks, provided before negotiation begins.
- Initial Fee
- One-off payment from franchisee to franchisor at the start of the agreement. Covers training, onboarding, brand access.
- Marketing Fund
- A pool of contributions (usually 2–4% of franchisee gross) used for network-wide marketing. Held on trust; separately accounted; audited annually.
- Master Franchise
- An agreement granting a party the right to act as franchisor across a defined territory — typically used for cross-border expansion.
- Operations Manual
- The franchisor's documented operating system. The substrate that turns a brand from "founder-only" into "transferable."
- Renewal
- Extension of a franchise agreement past its initial term. Governed by the Code; not automatic.
- Restraint of Trade
- Clauses preventing the franchisee from competing after termination. Must be reasonable in scope and duration to be enforceable.
- Royalty
- Ongoing payment from franchisee to franchisor. Usually a percentage of gross revenue. Typically 5–8%.
- Sub-franchisee
- A franchisee operating under a master franchisee rather than directly under the original franchisor.
- System
- The franchisor's operating method — brand standards, training, processes, technology — that defines how the franchisee runs the business.
- Territory
- The geographic area in which a franchisee operates. May be exclusive, non-exclusive, or open.
- Transfer
- Sale of a franchise from one franchisee to another. Usually subject to franchisor consent and a transfer fee.
- Unit Economics
- The financial performance of a single franchise venue — revenue, costs, margin. The foundation for any franchise decision.
- Vicarious Liability
- When the franchisor is held legally responsible for the conduct of franchisees. Limited in Australia but not absent.
Franchise Basics
Franchise Glossary.
Plain-English definitions of the franchise terms you'll encounter in any disclosure document, agreement or conversation. Australian usage where it differs from US.