Dec 31, 2020 - Blog, Franchise Articles by |

If the start of the New Year has you thinking about buying a franchise, there are several important factors you will want to consider as you evaluate different franchise opportunities and make your final decision about moving forward. While many of these factors have to do with the financial aspects of buying a franchise, you need to consider the pertinent legal issues as well, as failing to protect yourself legally could potentially put your franchise in jeopardy. Here, national franchise lawyer Jeffrey M. Goldstein discusses four important legal considerations for individuals who are thinking about buying a franchise in 2021:

1. How Have Other Franchisees Fared During the Pandemic?

Even once the COVID-19 vaccine is available to everyone nationwide, things still won’t fully be back to normal for some time. As a result, while there is reason for optimism in 2021, as a prospective franchisee, it is still important to take cues from 2020.

Within the brands you are considering, how have existing franchisees fared during the pandemic? Are they optimistic about the future? You can find franchisees’ contact information in the Franchise Disclosure Document (FDD), and you can – and should – speak with many franchisees during the due diligence process.

2. What Will Happen if Your Franchise Isn’t Successful?

No one wants to think about the possibility of failure when buying a franchise. But, the reality is that addressing this contingency is one of the most important aspects of ensuring that you have reasonable legal protections before you buy. If your franchise starts to struggle, what options will you have to avoid termination? What will be at risk if you lose your franchise rights? These are questions that you need to address before signing a franchise agreement.

3. Will You Have a Protected or Exclusive Territory?

As a franchisee, territorial protection or exclusivity can be extremely important. Some franchisors offer territorial rights while others do not, and territorial rights can vary widely from one brand to the next. Importantly, territorial rights are not always as they seem, so you will need to be very careful to ensure that you have an accurate understanding of what other franchisees (and the franchisor) can and cannot do in your territory.

4. Will You Be Able to Renew Your Franchise?

Finally, let’s say your franchise is a success. At the end of your initial term, you will want to renew. Will you be able to do so?

Many franchisors reserve broad discretion over franchisee renewals; and, even if your franchise is profitable, this does not necessarily mean that your franchisor will want to (or be forced to) grant a renewal. When negotiating your franchise agreement, making sure you have adequate protection with regard to renewal will be an essential part of the process.

Schedule a Free Initial Consultation with National Franchise Lawyer Jeffrey M. Goldstein

Are you thinking about buying a franchise in 2021? If so, it will be important for you to hire an experienced franchise lawyer to review the FDD and negotiate your franchise agreement. To learn more in a free and confidential consultation, call us at 202-293-3947 or request an appointment online today.

Lawyer USA

Antitrust and Franchise Law Firm of the Year in DC

Lawyer USA

Leading Professionals in Law

Lawyer USA

Franchise Law
in the District of Columbia

Lawyer USA

Franchise Law Firm
of the Year – USA

Lawyer International

Lawyer International
Legal 100
2018

Lawyer International

Lawyer International
Legal 100
2019

ACQ5 LAW AWARDS 2019

US (New York)
Franchise Lawyer
of the Year
ACQ5 GLOBAL AWARDS 2019, JEFF GOLDSTEIN, GOLDSTEIN LAW FIRM, PLLC

ACQ5 LAW AWARDS 2019

US (New York)
Franchise Law Firm
of the Year
ACQ5 GLOBAL AWARDS 2019, GOLDSTEIN LAW FIRM, PLLC

Lawyers of Distinction logo

2020 Power Lawyers

Esteemed Lawyers of America Logo

Esteemed Law Firm Complex Litigation

Global Law Experts Logo

Recommended Firm in Franchise Litigation

Who's Who Attorney Logo

Top Attorney USA – Litigation

Avvo Franchise Lawyer Symbol

Superior Attorney in Franchising

Avvo Franchise Lawyer Symbol

Superior Attorney in Antitrust

Finance Monthly Global Award Winner Logo

Franchise Law Firm of the Year

Lead Counsel logo

Chosen Law Firm for Commercial Litigation

BBB of Washington DC

A+ Rated

Washington DC Chamber of Commerce

Verified Member

Lawyers of Distinction logo

Franchise Law Firm of the Year

ISSUU

Best Law Firm for Franchise Disputes in 2017

Law Awards Finanace Monthly

Franchise Law Firm of the Year - 2017

Top Franchise Litigator for Franchisees and Dealers

Top Franchise Litigator for Franchisees and Dealers

2017 Finance Monthly Award

2017 Finance Monthly Award

ACQ5 LAW AWARDS 2018

Franchise Law Firm
of the Year
ACQ5 LAW AWARDS 2018

ACQ5 LAW AWARDS 2019

Franchise Law Firm
of the Year
ACQ5 LAW AWARDS 2019

Franchise Law Firm of the Year

Franchise Law Firm of the Year

Franchise Law Firm of the Year

Franchise Law Firm of the Year
Global Awards 2017

Global Law Experts

Franchise Law Firm
of the Year
in New York – 2019

Finance Monthly Law Awards - 2018

Finance Monthly Law Awards - 2018

Franchise Law Firm of the Year

Franchise Law Firm
of the Year
Global Awards 2018

Contact Us

Goldstein Law Firm, PLLC

1629 K St. NW, Suite 300,
Washington, DC 20006

Phone: 202-293-3947
Fax: 202-315-2514

Free Consultation

Free Consultation