Franchise Glossary
C-Corporation
What is C-Corporation in franchising?
A standard corporate structure that is a separate legal entity from its owners. In franchising, a C-Corp is a required component of a ROBS (Rollover for Business Startups) structure. The retirement plan invests in the C-Corp, which uses the funds to purchase the franchise. Beyond ROBS, some franchisors require or prefer franchisees to form a C-Corp or LLC for liability and operational reasons. A franchise attorney or business attorney should advise on entity structure before signing any agreement.