Franchising is a sophisticated business model that combines the advantages of large companies and independent operations, enabling rapid expansion and global brand presence. Basically franchise is a contractual relationship between the franchisor, who provides the brand and the business model, and the franchisee, who uses these resources to run his own business. There are several types of franchises, including product franchises, service franchises, and business format franchises, each with their own unique features and requirements. The key participants in a franchise are the franchisor, the franchisee and supervisors who help maintain standards. The advantages of the model, such as rapid expansion and brand awareness, are balanced by disadvantages, such as reduced freedom for the franchisee and high initial costs. As a distribution strategy, franchising differs from traditional methods in its structure and approach. Thus, it enables faster market penetration through brand recognition and process standardization, which creates more opportunities for branding and channel optimization. Successful franchise models, such as McDonald's and Subway, serve as examples that prove that a franchise business can work effectively in different industries and areas thanks to consistent quality and a global presence. Legal aspects of franchising are related to intellectual property protection and dispute resolution mechanisms. The franchise system agreement highly regulates the protection of intellectual property and ownership rights in order to preserve the uniqueness of the franchise. Disputes can be resolved through mediation and court proceedings, provided that all participants understand their rights and obligations. The economic components of franchising include finance, risks and effects on the economy. Franchise models usually involve significant initial investment, but can provide steady income through regular fees and profit shares. Risks include the possibility of business failure and reliance on the success of the franchisor. However, franchising can have positive economic effects by creating jobs and supporting local economies. The management and operation of the franchise system is key to success. Maintaining the franchisor-franchisee relationship, quality control and standardization are key. Innovation and adaptation to the market also play a significant role in maintaining competitiveness. The digital era presents new challenges and opportunities for franchising. The Internet and digital technologies are improving online distribution channels and e-franchising, providing flexibility and scalability, while digitization creates data protection challenges and requires constant innovation. These aspects illustrate the need for franchise modification to remain competitive and successful in today's market.