If you are considering a venture into the world of franchising, there is a lot you need to know. From practical considerations (i.e. Do you have the drive to grow a successful business?) to financial ones (i.e.
How much can you reasonably expect to make as a franchisee, and is it enough?), buying a franchise is not a decision to be made lightly.
Then, there are the legal aspects. A franchise is a legal relationship governed by a complex (and franchisor-friendly) franchise agreement and a variety of general, franchise and industry-specific laws. To protect their financial interests and ensure that they have as many rights as possible, it is imperative that prospective franchisees give due consideration to the relevant legal issues during the franchise buying process.
These resources provide an introduction to many of the legal issues that are important to franchisees:
1. Why Buy a Franchise?
Have you asked yourself, “Why do I want to buy a franchise?” It is an important question, and one that gets overlooked with surprising frequency. Often, potential buyers get hooked on the idea of hitting the ground running while still running their own businesses, or they get sold on a particular franchise opportunity without stopping to truly consider the long-term implications.
Buying a franchise can certainly have benefits, but these benefits come with risks as well. We examine both sides of the issue in: Why Buy a Franchise?
2. Big or Small (and Does It Matter)?
Are you considering a national brand, or are you interested in a local, niche franchise opportunity? Franchisees in large and small franchise systems will often have vastly different experiences, and the legal implications of big-versus-small are worth considering as well. Learn more in: Considerations for Choosing Between New and Established Franchise Systems.
3. Do You Really Need to Read Your Franchisor’s FDD?
The Franchise Disclosure Document (FDD) provides information about several key aspects of what a franchisor has to offer, and all prospective franchisees should carefully review their franchisors’ FDDs. We explain what to look for in our three-part series, Understanding Your Franchisor’s FDD:
- Understanding Your Franchisor’s FDD – Part 1
- Understanding Your Franchisor’s FDD – Part 2
- Understanding Your Franchisor’s FDD – Part 3
4. What is Involved in Buying a Franchise?
Buying a franchise is a process, and a daunting one at that. Franchise attorney Jeffrey M. Goldstein explains what prospective franchisees can expect in: Considering a Franchise? An Overview of the Franchise Buying Process.
5. What Do I Need to Do to Protect Myself?
From a legal perspective, there are two critical steps involved in making an informed buying decision: due diligence and franchise agreement negotiations. These articles provide some due diligence tips and discuss some key issues that often come up during negotiations:
- 10 Key Considerations for Due Diligence in Purchasing a Franchise
- What Not to Expect from Your Franchisor
- Top 10 Worst Provisions in a Franchise Agreement
- What Do You Need to Know about the “Liquidated Damages” Clause in Your Franchise Agreement?
Goldstein Law Firm | Exclusively Representing Franchisees and Dealers
If you are considering a franchise opportunity, we encourage you to contact us for a free initial consultation. We are happy to help you gain a better understanding of the legal considerations involved, and we offer a number of flat-fee service options for prospective franchisees. To speak with national franchise attorney Jeffrey M. Goldstein, please call (202) 293-3947 or inquire online today.
