If you are thinking about buying a franchise, obtaining a franchise business review is an important part of the process. Getting advice from an experienced franchise lawyer allows you to make informed decisions; and, while you may want your lawyer to provide a “seal of approval” for your chosen franchise opportunity, the true goal is to get unbiased legal advice focused on your long-term best interests.
When you buy a franchise, there is a chance that your franchise will fail. This is a risk you take when you sign your franchise agreement, and it is a risk that you should take only if you have a clear and comprehensive understanding of what you can expect as a franchisee. But, while there are many factors that prospective franchisees need to consider, there is one factor that they shouldn’t: Franchisees shouldn’t have to worry about their franchisors failing. Unfortunately, in many cases they do. This is a fact our franchise lawyers know all too well.
A recent article on FranchiseDirect.com, entitled 5 Traits of Successful Franchisees, discusses what it takes to grow a profitable franchised outlet. Here, franchisee attorney Jeffrey M. Goldstein shares his thoughts based on more than 30 years of experience exclusively representing franchisees and dealers.
Many franchise agreements include provisions for mandatory mediation. While mediation is intended to be neutral and provide an opportunity for the parties to resolve their dispute without going to court, the reality is that the requiring mediation benefits franchisors in many cases. So, as a franchisee, what can you expect in mediation? Franchise lawyer Jeffrey M. Goldstein explains:
Under the Federal Trade Commission (FTC) Franchise Rule and various state franchise laws, franchisors have a legal obligation to disclose certain information to prospective franchisees. While franchisees cannot pursue claims under the FTC Franchise Rule, they can pursue claims under state franchise laws in many cases. In this article, franchise attorney Jeffrey M. Goldstein explains what constitutes a franchise disclosure violation, and discusses the potential implications for disputes between franchisees and franchisors.
Buying a franchise is a long-term investment. Generally speaking, franchisees need to prepare themselves to be in it for the long haul. But, things happen, and there are a variety of reasons why someone might want to exit a franchise prior to the date of expiration. In this article, franchise lawyer Jeffrey M. Goldstein discusses four potential options for getting out of a franchise agreement.
When buying a franchise, it is important to review the franchise disclosure document (FDD) in its entirety. Each of the FDD’s 23 “Items” contain information that is relevant to prospective franchisees’ buying decisions. But, as with most legal documents, certain provisions are potentially more impactful than others, and franchise buyers will want to pay particular attention to these provisions during their due diligence. In this article, franchisee attorney Jeffrey M. Goldstein highlights seven “can’t miss” provisions of the FDD.
We discussed the virtual restaurant trend a couple of months ago. In that article, we explored the link between the virtual restaurant trend and the COVID-19 pandemic, and we noted that many new franchise concepts were popping up—apparently in direct response to the rising consumer demand for takeaway and delivery restaurant-quality meals. Now, as national franchisee lawyer Jeffrey M. Goldstein notes, some big brands are stepping into the virtual restaurant franchise realm.
Item 20 of the Franchise Disclosure Document (FDD) provides an overview of the status of a franchise system. Its tables disclose the number of active franchises, terminations, non-renewals and closures over the past three years, as well as the number of franchisees who have signed agreements but not yet opened and the franchisor’s projections for the upcoming year. These are all valuable pieces of information, and they allow prospective franchisees to gain some important insights with the help of an experienced franchise lawyer.
Franchises come in all shapes and sizes. While some franchises require franchisees to invest in a retail location and hire multiple employees, others allow franchisees to act as owner-operators. These franchisees not only manage their businesses, but they also run their businesses on the ground. Known as owner-operators, these franchisees do almost everything on their own—from ordering and managing inventory and supplies to conducting sales and providing services to customers.