{"ok":true,"canonical_url":"https://dealroom.so/glossary/franchise-business","api_url":"https://dealroom.so/api/public/glossary/franchise-business","data_freshness":{"sba_records_through":"2026-05-31","fdic_records_through":"2026-03-31","dealroom_last_updated":"2026-06-15","timezone":"America/Chicago"},"source_summary":["Public SBA 7(a) loan records","FDIC institution data","DealRoom lender and franchise enrichment"],"term":{"slug":"franchise-business","term":"Franchise business","group":"Reading the business","definition":"A business operating under a license from a franchisor, using their brand, system, and support. This structure comes with specific operating rules and fees.","what_it_means":"Buying a franchise business involves reviewing the franchise agreement and ensuring the franchise is listed on the SBA Franchise Directory for 7(a) eligibility. You'll need to be approved by the franchisor as a new franchisee. Understand the ongoing royalty fees and operational constraints before committing.","url":"https://dealroom.so/glossary/franchise-business","official_sources":[{"slug":"13-cfr-part-120","title":"13 CFR Part 120 — Business Loans","official_url":"https://www.ecfr.gov/current/title-13/chapter-I/part-120","official_label":"View on eCFR","authority_tier":1,"publisher":"Office of the Federal Register","source_guide_url":"https://dealroom.so/sba-7a/sources/13-cfr-part-120"},{"slug":"sop-50-10","title":"SOP 50 10 — Lender and Development Company Loan Programs","official_url":"https://www.sba.gov/document/sop-50-10-lender-development-company-loan-programs","official_label":"View on SBA.gov","authority_tier":2,"publisher":"U.S. Small Business Administration","source_guide_url":"https://dealroom.so/sba-7a/sources/sop-50-10"}],"related":[{"slug":"franchise","term":"Franchise","url":"https://dealroom.so/glossary/franchise"},{"slug":"franchise-agreement","term":"Franchise agreement","url":"https://dealroom.so/glossary/franchise-agreement"},{"slug":"due-diligence","term":"Due diligence","url":"https://dealroom.so/glossary/due-diligence"},{"slug":"sba-regulations","term":"SBA regulations","url":"https://dealroom.so/glossary/sba-regulations"}],"related_questions":[{"question":"What are the eligibility requirements for a franchise business not listed on the SBA Franchise Directory?","url":"https://dealroom.so/for-lenders/questions/what-are-the-eligibility-requirements-for-a-franchise-business-not-listed-on-the-sba-franc"},{"question":"If I acquire a franchise, does the SBA approve the specific franchise location and its business plan?","url":"https://dealroom.so/sba-7a/questions/if-i-acquire-a-franchise-does-the-sba-approve-the-specific-franchise-location-and-its-busi"},{"question":"Can I use an SBA 7(a) loan to acquire a franchise business not yet listed on the SBA Franchise Directory?","url":"https://dealroom.so/sba-7a/questions/can-i-use-an-sba-7-a-loan-to-acquire-a-franchise-business-not-yet-listed-on-the-sba-franch"},{"question":"If I acquire a franchise, does the SBA approve the specific franchise location?","url":"https://dealroom.so/sba-7a/questions/if-i-acquire-a-franchise-does-the-sba-approve-the-specific-franchise-location"},{"question":"What if a franchise agreement is not listed on the SBA Franchise Directory?","url":"https://dealroom.so/for-lenders/questions/what-if-a-franchise-agreement-is-not-listed-on-the-sba-franchise-directory"},{"question":"What due diligence is required for a franchise not on the SBA Franchise Directory?","url":"https://dealroom.so/sba-7a/questions/what-due-diligence-is-required-for-a-franchise-not-on-the-sba-franchise-directory"}]},"caveats":["Definitions represent DealRoom's plain-English interpretation for buyers; verify regulatory terms against the official SBA and eCFR sources listed.","Not legal, tax, or financial advice, and not an SBA eligibility determination."],"citation":{"label":"DealRoom.so Glossary — Franchise business","url":"https://dealroom.so/glossary/franchise-business","source_type":"DealRoom Data"}}