Perhaps the father of modern franchising, though, is Louis Kroh Liggett.In 1902, Liggett invited a group of druggists to join a "drug cooperative." As he explained to them, they could increase profits by paying less for their purchases, especially if they set up their own manufacturing company. About 40 druggists pooled ,000 of their own money and adopted the name "Rexall." Sales soared, and "Rexall" became a franchisor.
Other companies tried franchising in one form or another after the Singer experience.
For example, several decades later, General Motors Corporation established a somewhat successful franchising operation in order to raise capital.
The sharing of responsibility associated with contemporary franchising arrangement did not exist to any great extent.
Consequently, franchising was not a growth industry in the United States.
Thirty-three countries—including the United States and Australia—have laws that explicitly regulate franchising, with the majority of all other countries having laws which have a direct or indirect impact on franchising.
The boom in franchising did not take place until after World War II.His was one of the earliest—and most successful—franchising operations in the United States.The Singer Company implemented a franchising plan in the 1850s to distribute its sewing machines.The franchisor's success depends on the success of the franchisees.The franchisee is said to have a greater incentive than a direct employee because they have a direct stake in the business.One of the first successful American franchising operations was started by an enterprising druggist named John S. In 1886, he concocted a beverage comprising sugar, molasses, spices, and cocaine (which is no longer an ingredient).