Franchising Contracts

A franchise is an arrangement where the owner of a business (the franchisor) allows another party (the franchisee) to run the business under the franchisor’s trade name and branding but retains a degree of control over the business, providing assistance and guidance in the way it is run.

If you are considering entering into a franchise, you may be looking at your 50+ page franchise contract with some trepidation. For a fixed fee, we can walk you through the legalese and advise you on the pros and cons of your contractual obligations.
Franchising a proven and successful business concept can be a profitable way of expanding your business.  If you are considering the possibility of franchising your business, we can help you lay the correct foundations and prepare appropriate documentation to protect your business concept and brand.

What is a franchise?

A franchise is an arrangement where the owner of a business (the franchisor) allows another party (the franchisee) to run the business under the franchisor’s trade name and branding but retains a degree of control over the business, providing assistance and guidance in the way it is run.

A franchise is normally set up as a way of expanding a business through a form of shared costs and returns. Typically the franchisee may make a contribution to any initial capital expenses (such as shop-fitting costs) and will pay an upfront franchise fee together with regular payments (equivalent to rent) based on an agreed percentage of profit or turnover achieved. 

As such franchising has significant advantages for both the franchisor and franchisee. The franchisor is able to keep a degree of control over the business whilst sharing the costs and benefits of expansion, and the franchisee gains a head start in the marketplace by securing the benefit of immediate trading under an established brand name. 

Whether you are a franchisor or franchisee, our commercial lawyers can provide you with comprehensive advice on drafting and negotiating a franchise agreement.

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