Similar to other large purchases, becoming a franchisee requires entering into many complex legal documents. While the agreements and disclosures are often lengthy, they are important legal documents that should be evaluated. Two of the most important documents are...
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Franchise Law
A brief history of franchise law
I bet you are wondering why a sewing machine is the cover image of an article on the history of franchise law. Keep reading to learn more. Over the centuries, people developed the concept of franchising to expand businesses in a way that could spread risk among the...
A franchise lawyer is different than a business attorney in important ways
While all franchises are businesses, hiring a general business lawyer to handle franchisee issues can be a costly mistake. A knowledgeable franchise lawyer will have extensive experience with state and federal franchise laws, understands a franchise disclosure...
Common franchise red flags
While a franchisor has certain disclosure obligations that are required by federal and state laws, they are also interested in selling their franchise. In some cases, a franchisor may paint an unrealistic picture of what owning a franchise in their system is like....
Evaluating a promise of earnings
Investors who buy a franchise should be wary of a franchisor’s guarantee of making a large amount of money quickly. Nonetheless, the franchisor may disclose information about potential sales and income known as an earnings claim or financial performance representation...
Territory pre-planning is a must
It is crucial for franchisees to understand the importance of territory pre-planning when working with franchisors before they head into a new market. It is an easy-to-avoid mistake for a franchisor to divide up a city by districts or even blocks with little regard...
Evaluating a retail site location
It is a cliché that the three most important things in the property's desirability are location, location, and location. This is not entirely true, but it does emphasize the point that the right site for a business can be the difference between a successful ongoing...
Issues to consider when choosing a franchise
Buying a franchise involves certain risks. It is not as chancy as a start-up because hopefully there is name and brand recognition as well as business guidance and an established product or service. But there are still specific business issues to consider before...
Is buying a franchise a good fit?
People often dream of opening their own business. However, there are questions to ask oneself before actively shopping for a franchise, reviewing a franchisor's disclosure document, or attending a discovery day. The answers to these inward-looking questions from...
Can I terminate a franchise agreement?
Buying a franchise may have been a great business opportunity when you first signed the contract, but maybe a few years down the road, you realize it is just not for you. Whether you are not making as much of a profit as you hoped or you have decided this type of...