This paper analyzes franchise business on the example of McDonald's in Croatia. The goal of the research is to understand how the franchise business model works in practice, what are the advantages and challenges faced by franchisees, and how McDonald's adapts its business to the local market. A general overview of franchise business is provided, including the key elements and advantages of this model. Furthermore, the paper investigates the specifics of McDonald's franchise operations in Croatia, including history, development of the restaurant network, training and support that franchisees receive, and adaptations to the local market. Special attention is paid to the challenges faced by franchisees, such as high operating costs and competition in the fast food market. The paper highlights the importance of the franchise model as a strategy for business growth and expansion, as well as its potential and limitations in the context of the Croatian market.