For more than 40 years, Coverall®, a leading franchisor of commercial cleaning services, has been guiding and educating entrepreneurs on how they can start an independent commercial cleaning franchise business. In fact, our network of 8,000 people includes individuals of all backgrounds and levels of business experience.

We’ve encountered a number of questions related to franchise ownership and whether there are any similarities to chain business ownership. For people looking to start their first business, many don’t understand the differences between franchising and chain stores.

Prior to any business commitment, it is important to understand the distinction between a chain and a franchise business because it affects how businesses are operated, managed and expanded.

Chain businesses and franchise businesses are both common models in retail, hospitality, and other service industries, but they differ in several key aspects:

1. Ownership and Control
Chain Business: A chain business is owned and operated by a single company or entity. The parent company maintains full control over all locations, including their operations, management, and branding. Decisions regarding the business, such as pricing and marketing strategies, are centralized and made by the parent company.

Franchise Business: In a franchise model, the business is owned and operated by an independent Franchise Business Owner, who purchased the rights to operate under the franchisor's brand name. The franchisor provides guidelines, training and support, but the Franchise Owner has autonomy in day-to-day operations, within the framework set by the franchisor.

2. Investment and Revenue Structure
Chain Business: The parent company provides all the capital for opening and operating new locations. Revenue from all locations flows back to the parent company. Since there is no separate owner for each chain location, profits and losses are consolidated at the company level.

Franchise Business: Franchise Business Owners typically pay an initial franchise fee and ongoing royalties to the franchisor, in addition to covering the costs of setting up and running their location. After satisfying any fees owed to the franchisor, the Franchise Business Owner keeps the remaining revenue.

3. Risk and Responsibility
Chain Business: The parent company bears the financial risks associated with each location, including operational failures, market downturns or location-specific issues. The company is responsible for staffing, supply chain management and all operational tasks.

Franchise Business: The Franchise Business Owner oversees and assumes responsibility for its independently owned business. The franchisor’s risk is more limited, revolving around maintaining brand reputation and supporting its Franchise Business Owners.

4. Employee Management
Chain Business: In chain businesses, the parent company manages all aspects of employee management, from recruitment to training and daily supervision. This centralized approach ensures that all employees meet the company’s standards and practices.

Franchise Business: In contrast, Franchise Business Owners are responsible for managing their employees. They have the flexibility to recruit and train staff according to the specific needs of their business.

A Coverall Commercial Cleaning Franchise
Coverall has built a network of 8,000 independent business owners who have achieved the dream of business ownership. With no experience needed, a proven roadmap to follow and affordable startup costs, starting a commercial cleaning business with Coverall is easy.

To have your questions answered regarding the franchise model, download our free guide.