The Anatomy of a Franchise Agreement
Your entire franchise investment begins and ends with the franchise agreement. It is the first step and the last step before you embark on your journey as a franchise owner - and one which requires careful review, understanding and advising by a qualified franchise lawyer.
An Introduction to the Franchise Agreement
Now that you have the franchise agreement in your hands, you are a signature away from finalizing the franchise sale. The review of the franchise agreement may only take a week or so to be assessed by your lawyer. But first, you should have general understanding of its contents and the terms and conditions outlined within.
Now that you have the franchise agreement in your hands, you are a signature away from finalizing the franchise sale. The review of the franchise agreement may only take a week or so to be assessed by your lawyer. But first, you should have general understanding of its contents and the terms and conditions outlined within.
Grant of Franchise
The Grant of Franchise is the introductory statement made in all franchise agreements, found at the beginning, that outlines the general terms of the franchise opportunity and the commitments that you will be bound by. It may include the term (or length of) the agreement and any renewal options.
The Grant of Franchise is the introductory statement made in all franchise agreements, found at the beginning, that outlines the general terms of the franchise opportunity and the commitments that you will be bound by. It may include the term (or length of) the agreement and any renewal options.
Payment of Fees
Your franchise agreement will contain a number sections that outline the fees due to the franchisor at various stages of the franchising process and once you are operating.
Your franchise agreement will contain a number sections that outline the fees due to the franchisor at various stages of the franchising process and once you are operating.
Training Program
As a new franchisee, the franchisor is obligated to conducting an Initial Training Program for all members affiliated with the franchise opportunity. While the cost of the training is included with your turnkey costs, any travel and lodging expenses at the training facility are not.
As a new franchisee, the franchisor is obligated to conducting an Initial Training Program for all members affiliated with the franchise opportunity. While the cost of the training is included with your turnkey costs, any travel and lodging expenses at the training facility are not.
Territorial Rights
The Franchise Agreement outlines the rights you have that protect your business within a prescribed geographical area. In most cases, the franchisor is not permitted to sell other franchises within this territory to restrict competitive activity.
The Franchise Agreement outlines the rights you have that protect your business within a prescribed geographical area. In most cases, the franchisor is not permitted to sell other franchises within this territory to restrict competitive activity.
Site Selection
The site selection phase of the franchising process can be frustrating and time-consuming. Your real estate agent becomes your biggest asset in locating the perfect location for your franchise. The franchisor should have key territories master planned by development site to position your outlet in an area with heavy traffic and high exposure.
The site selection phase of the franchising process can be frustrating and time-consuming. Your real estate agent becomes your biggest asset in locating the perfect location for your franchise. The franchisor should have key territories master planned by development site to position your outlet in an area with heavy traffic and high exposure.
Site Development
If the franchise agreement states that you are responsible for developing the site location, it is critical that you hire a certified contractor who can follow the franchisor's building specifications and adhere to all local laws and building codes.
If the franchise agreement states that you are responsible for developing the site location, it is critical that you hire a certified contractor who can follow the franchisor's building specifications and adhere to all local laws and building codes.
Sample Franchise Agreements
This site features a number of real franchise agreements from franchises you may recognize. They are fully downloadable but are for review purposes only. If you are interested in any one of these opportunities, contact the franchisor for an updated version.
This site features a number of real franchise agreements from franchises you may recognize. They are fully downloadable but are for review purposes only. If you are interested in any one of these opportunities, contact the franchisor for an updated version.