Each year, we publish lots of articles for franchisees on our blog. We know that being a franchisee can be hard, and we want to make sure that those who need legal help are able to make informed decisions about their next steps. While some of our articles are relevant to a specific point in time, most are designed to serve as resources for years to come.
10 Key Takeaways for Franchisees Heading Into 2024
So, what lessons should franchisees carry into the New Year? Here are 10 key insights from franchise lawyer Jeffrey M. Goldstein heading into 2024:
1. What Should You Do if Your Franchise is Struggling?
At the beginning of 2023, many franchisees were still struggling due to the lingering effects of the pandemic. But, struggle is not unique to times of global upheaval. A significant percentage of new franchises fail, and for franchisees who are at risk of losing their businesses, it is important to know what options are available. Learn more: What Should You Do if Your Franchise is Struggling?
2. How Can Franchisees Effectively Manage Their Risk?
Even when franchisees aren’t struggling, they need to effectively manage their risk. Just one oversight or one wrong move can trigger substantial liability and put a franchise’s viability in jeopardy. What steps can (and should) franchisees take to protect themselves? We covered some key considerations in How to Effectively Manage Risk as a Franchisee.
3. What Are Your Legal Rights As a Franchisee?
As a franchisee, it is important to know your rights. Knowing your legal rights is the first step toward protecting them, and you need to know when it is time to take action. You also need to know what your options are if your franchisor claims a default or threatens termination. We outlined some of the franchisees’ most important rights in: What Are Your Legal Rights As a Franchisee?
4. Does Your State Have a Franchise Law?
One source of franchisees’ legal rights in some states is their state’s franchise law. State franchise laws provide both rights and remedies, and they broadly fall into two main categories: disclosure laws and relationship laws. State disclosure laws entitle franchisees to rescind their franchise agreements in some cases, while relationship laws provide other remedies for franchisees who fall victim to their franchisors’ bad-faith practices. Learn more: Does Your State Have a Franchise Law? If So, Why Does It Matter?
5. When Can You Sue Your Franchisor?
Franchisees can encounter a variety of issues in the course of the franchisor-franchisee relationship, and sometimes, they will need to think about hiring a franchise lawyer to sue their franchisors. If you are dealing with a dispute, it is important to know if you have sufficient grounds to sue. You also need to know if suing is likely to be worth it, and there are a variety of other important considerations as well. We covered the first of these considerations in 10 (Potential) Grounds to Sue Your Franchisor.
6. What Mistakes Do Franchisees Need to Avoid When Facing a Dispute?
Just like buying a franchise, when you are facing a franchise-related dispute, there are both steps you need to take and mistakes you need to avoid. There are several mistakes that can prove extremely costly—and that can even prevent franchisees from achieving a just outcome in some cases. These include mistakes ranging from going public on social media to choosing the wrong lawyer. Learn more: What Not to Do if You Are in a Dispute With Your Franchisor.
7. What Do Franchisees Need to Know About Arbitration?
While suing is an option in some cases, many franchisor-franchisee disputes end up in arbitration. Many franchise agreements include mandatory arbitration provisions, and these provisions are generally enforceable—even though they can inherently favor franchisors. As a result, arbitration is an important topic for franchisees, and we covered several aspects of arbitration during the year. For example:
8. What Do You Need to Know if Your Franchisor is Getting Bought Out?
While some franchisors are in it for the long haul, some start franchising with the specific goal of selling out. Learning that a new group of people will play a role in your franchise’s success can be a shock to the system, and, in some cases, it can present significant concerns. We addressed some of these concerns in My Franchisor is Getting Bought Out—Should I Be Worried?
9. What Do You Need to Know if You Have Been Labeled a “Problem Franchisee”?
Being labeled a “problem franchisee” can present significant concerns as well. Whether you are vocal in your franchise association, your franchise is underperforming, or your franchisor is singling you out for other reasons, constantly being on your franchisor’s radar can be frustrating, exhausting, and risky. If you find yourself in this situation heading into 2024, here’s what you need to know: How To Deal with Being Labeled a “Problem Franchisee.”
10. What if Your Franchisor (or Another Franchisee) is Encroaching on Your Territory?
Encroachment is yet another significant concern for franchisees. Franchisees who find themselves dealing with encroachment need to act quickly and ensure that they make the right decisions to protect themselves. Depending on the circumstances, this may include taking action to hold their franchisor liable. Learn more: When is a Franchisor Liable for Encroachment?
Schedule a Free and Confidential Consultation with Franchise Lawyer Jeffrey M. Goldstein
If you need to know more about your legal rights, your franchisor’s legal rights or any other aspect of your franchise heading into 2024, we invite you to get in touch. Franchise lawyer Jeffrey M. Goldstein has well over 30 years of experience and represents franchisees nationwide. To request a free and confidential consultation, please call 202-293-3947 or contact us online today.