Franchising is a globally embraced business model based on contracts between a franchisor and its franchisees. In 2005, the franchising sector contributed an estimated 14 per cent of Australia's gross domestic product. In 2006, there were approximately 960 business format franchise networks in Australia, with an estimated 62,000 franchisees1 operating units dependent on these franchisors remaining solvent. Like any other commercial entity, a franchisor might become insolvent.
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