The rise of franchising after the 1950s created a new kind small business, one tightly controlled by a larger corporation but still "independent" under the law and in the minds of market participants. The new status of "franchisee," someone licensed to operate a small business under the brand name, direction, and control of a corporate franchisor, did not sit cleanly within existing legal and social categories of entrepreneur, investor, or employee.
Franchisee associations, organizations protecting and advancing the interests of franchisees, arose soon after the birth of modern franchising. Different associations emphasized a variety of conceptions of the franchise relationship, and pursued a wide range of sometimes conflicting goals. Some franchisee associations embraced the identity of "investor" and demanded legal protections for their financial investments. Others pushed for recognition of franchisee rights as "entrepreneurs" to control their own small businesses, free from excessive franchisor interference. Some associations even demanded collective bargaining rights commensurate with wage workers, causing franchisors to complain that their franchisees had been infected with "the ideas of Eugene Debs."
This paper traces the history of franchisees negotiating their unusual status, and the shifting coalitions between franchisors, franchisees, and workers that emerged as franchising developed and grew into a major organizational in retail and service industries.