FOFO, FOCO, COFO, COCO — franchise ownership models explained
Four two-part acronyms describing who owns a franchise outlet and who operates it. What each means for capital and control.
These four acronyms describe two separate questions: who owns the outlet, and who operates it. Read them as two halves.
| Model | Owned by | Operated by | Franchisee's role |
|---|---|---|---|
| FOFO | Franchisee | Franchisee | Invests and runs it |
| FOCO | Franchisee | Company | Invests; the brand runs it |
| COFO | Company | Franchisee | Runs it; the brand funded it |
| COCO | Company | Company | Not a franchise at all |
What each means in practice
FOFO — Franchise Owned, Franchise Operated. The classic model. The franchisee puts up the capital and runs the outlet, paying franchise fee and royalty. Maximum control, maximum risk.
FOCO — Franchise Owned, Company Operated. The franchisee invests but the brand operates. The investor is closer to a landlord with an earnings share, and returns are often structured as a guaranteed payout or revenue share rather than outlet profit. Attractive to investors who want exposure without operating.
COFO — Company Owned, Franchise Operated. The brand funds the outlet and a franchisee-operator runs it, usually for a management fee or profit share. Used to put strong operators into strategic locations they could not fund.
COCO — Company Owned, Company Operated. A company store. Included here only because it appears in the same tables.
What people get wrong
Reading FOCO as low-risk. The capital is still the investor's. What is guaranteed depends entirely on the contract, and a guarantee is only as good as the brand behind it.
Assuming the model is fixed. Many brands run several models across their network and will discuss which applies to a given location.
On Bidancer
The operating model is part of the structured franchise offering, so an investor can filter for FOFO or FOCO rather than reading through prose to find out which is on offer.