Syllabus: OCR - A and AS Level Business
Module: Introduction to Business
Lesson: Franchises and Franchisees

Introduction

The topic of franchises and franchisees sits within OCR’s A and AS Level Business specification (Unit 1: Business Objectives and Strategic Decisions). It provides learners with a practical lens through which to explore how businesses expand and how entrepreneurial individuals can operate within structured business models. This lesson is particularly valuable because it bridges theoretical understanding with business structures students are likely to encounter both in the exam and real-world employment settings.

OCR’s specification explicitly references franchises under business ownership models, requiring students to understand their benefits and drawbacks. This topic supports broader learning around entrepreneurship, strategic growth, and decision-making — making it ideal for an active learning approach grounded in real commercial practice.

Key Concepts

Students studying this topic should be able to:

• Define what a franchise is: a legal agreement that allows one business (the franchisee) to operate using the name, branding, and business model of another (the franchisor).

• Identify key roles and responsibilities of the franchisor vs. the franchisee.

• Analyse the benefits and drawbacks of running a franchise business from both perspectives.

• Distinguish between independent start-ups and franchising as business growth strategies.

• Evaluate franchising as a means of reducing risk for new entrepreneurs and as a scalable model for growth.

• Apply knowledge to exam scenarios involving business start-ups or expansion choices.

The OCR specification encourages students to consider these through the lens of strategic decision-making, opportunity cost, risk, and reward.

Real-World Relevance

Franchising is a significant feature of the UK economy. Brands such as McDonald’s, Subway, Costa Coffee, and Anytime Fitness all operate under the franchise model — and many employ young people who may one day consider becoming franchisees themselves.

A relevant mini case study: Greggs, the UK’s largest bakery chain, uses a hybrid model of company-owned stores and franchises in service station locations. This allows them to grow into areas where direct operation might be logistically or financially unfeasible. Students can explore how this supports brand consistency while reducing capital expenditure.

Another example: Snap Fitness, which targets individuals with lower upfront investment but high operational autonomy, is a useful contrast to more prescriptive franchise models.

How It’s Assessed

OCR uses a variety of assessment methods that may draw on this topic:

• Short-answer questions: e.g. “State two benefits of franchising to a franchisor.”

• Analysis tasks: e.g. “Analyse the potential risks of becoming a franchisee.”

• Extended response: often requiring students to evaluate franchising as a strategy within a given context, weighing it against alternatives.

Key command words to focus on include:

• Explain – outline what franchising is or its key features.

• Analyse – explore reasons behind its use, supported by business logic.

• Evaluate – compare with alternative strategies, make judgements based on the context.

Students should practise applying these in business case contexts and be able to support their answers with reasoning and quantitative or qualitative evidence where appropriate.

Enterprise Skills Integration

Franchises are an ideal topic for developing:

• Decision-making: weighing franchise versus independent start-up paths.

• Risk awareness: considering financial and reputational risks from both perspectives.

• Problem-solving: how a franchisee might respond to local competition or customer needs within brand constraints.

• Commercial awareness: understanding how businesses balance growth, control, and consistency.

Enterprise Skills’ Business Simulations are particularly well-suited for embedding this content. In simulation, students can take on the roles of franchisors and franchisees, making decisions around location, staffing, and pricing — and seeing the outcomes of their choices play out. It’s real business, minus the real-world risk.

Careers Links

This topic supports Gatsby Benchmarks 4, 5, and 6:

• Benchmark 4: Linking curriculum learning to careers – franchising connects clearly to roles in business development, retail management, and entrepreneurship.

• Benchmark 5: Encounters with employers – inviting franchise owners into the classroom adds authentic insight.

• Benchmark 6: Experiences of workplaces – simulations or work shadowing in franchised environments can give students real-world exposure.

Relevant pathways include:

• Franchise management roles (e.g. Store Manager at Costa or KFC)

• Entrepreneurship (becoming a franchisee)

• Business consultancy (advising new franchise models)

• Operations management in franchise networks

Franchising also builds confidence in applying business principles to employment scenarios — especially relevant for BTEC and vocational learners considering self-employment.

Teaching Notes

Common pitfalls:

• Students often assume franchising is easy because the brand is established — encourage critical thinking around costs, obligations, and autonomy.

• Confusion between franchisor and franchisee roles — visual diagrams or role-play helps clarify.

Teaching tips:

• Use real-world franchise contracts or advertising packs (many are downloadable).

• Pair theory lessons with a decision-making activity: “Would you buy a Subway or start your own café?”

• Set a simulation challenge using Enterprise Skills Simulations: students run competing coffee shop franchises with varied decisions and report back with outcomes.

Stretch and challenge:

• Ask students to compare franchising with licensing and joint ventures.

• Explore ethical considerations of global franchising (e.g. local sourcing, wage standards).

Differentiation:

• For less confident learners, scaffold evaluations with structured templates or sentence starters.

• Use Skills Hub tools to offer low-prep digital tasks for flipped learning or revision.