{"ok":true,"canonical_url":"https://dealroom.so/glossary/franchisor-control","api_url":"https://dealroom.so/api/public/glossary/franchisor-control","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":"franchisor-control","term":"Franchisor Control","group":"Reading the business","definition":"The level of influence a franchisor has over the operations of a franchised business. This can impact your autonomy as an owner and affect SBA loan eligibility.","what_it_means":"The SBA has specific rules about franchisor control to ensure the small business borrower, not the franchisor, controls the business. Your franchise agreement will be reviewed to confirm that the franchisor doesn't have \"negative control\" over critical management decisions, such as hiring/firing or setting pricing. Confirm the franchise is listed on the SBA Franchise Directory before proceeding.","url":"https://dealroom.so/glossary/franchisor-control","official_sources":[{"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"},{"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"}],"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":"franchise-directory","term":"Franchise Directory","url":"https://dealroom.so/glossary/franchise-directory"},{"slug":"negative-control","term":"Negative control","url":"https://dealroom.so/glossary/negative-control"}],"related_questions":[{"question":"How does the SBA evaluate a franchise agreement not on the directory for acceptable franchisor control provisions?","url":"https://dealroom.so/for-lenders/questions/how-does-the-sba-evaluate-a-franchise-agreement-not-on-the-directory-for-acceptable-franch"},{"question":"What issues in a franchise agreement typically lead to a determination of 'undue control' by the franchisor?","url":"https://dealroom.so/for-lenders/questions/what-issues-in-a-franchise-agreement-typically-lead-to-a-determination-of-undue-control-by"},{"question":"How does the SBA determine if a franchisor has \"control\" over a franchisee for affiliation purposes, beyond standard agreements?","url":"https://dealroom.so/sba-7a/questions/how-does-the-sba-determine-if-a-franchisor-has-control-over-a-franchisee-for-affiliation-p"},{"question":"How does the SBA define 'undue control' by a franchisor that could render a franchise ineligible for 7(a) financing?","url":"https://dealroom.so/for-lenders/questions/how-does-the-sba-define-undue-control-by-a-franchisor-that-could-render-a-franchise-inelig"},{"question":"How does the SBA determine 'undue control' by a franchisor in a franchise agreement, making it ineligible for 7(a) financing?","url":"https://dealroom.so/for-lenders/questions/how-does-the-sba-determine-undue-control-by-a-franchisor-in-a-franchise-agreement-making-i"},{"question":"How does the SBA determine if a franchise agreement grants the franchisor 'undue control' over the franchisee, impacting 7(a) eligibility?","url":"https://dealroom.so/for-lenders/questions/how-does-the-sba-determine-if-a-franchise-agreement-grants-the-franchisor-undue-control-ov"}]},"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 — Franchisor Control","url":"https://dealroom.so/glossary/franchisor-control","source_type":"DealRoom Data"}}