What is a license vs. a franchise?
A license grants the right to use something — a trademark, a product, or a technology — usually for a fee, without the ongoing control and support that define a franchise. The practical difference is the FTC's three-element test: a trademark, a required payment, and significant operating control or assistance. A pure license lacks that control, so it is not a franchise and carries no FDD. Cross the control line and a "license" becomes an accidental franchise.
The distinction is not cosmetic. Under the FTC Franchise Rule, an arrangement with all three elements — a shared trademark, a required payment, and significant control or assistance — is a franchise and owes you a full FDD, whatever the contract's title says. Sellers sometimes label a deal a "license" or "dealership" to sidestep that disclosure; the law reads substance, not the label.
For a low-cost offer, the test to run is simple: does it come with an operating manual, mandatory training, territory rules, and ongoing fees? Those are franchise hallmarks, and their presence should arrive with an FDD. A true license hands you a name or a product and gets out of your way — cheaper and freer, but with none of the system a franchise fee is meant to buy. Compare both against what you actually need.