Franchise Information

The franchise agreement outlines the way your business will work within your franchise system. It gives both you, the franchisee, and your franchisor a clear understanding of the terms of your business relationship.

The franchise agreement also serves to ensure uniformity, which is beneficial not only to the franchisor but to the franchisee as well. If, for example, a customer has an unsatisfactory experience at another unit within your franchise, he will be unlikely to want to do business with your unit. Therefore, the franchisee is under obligation to maintain uniformity, and the franchise agreement will establish parameters for that uniformity.

These parameters include what products you'll use or sell at your franchise and the quality of services that must be provided by your employees.

The franchise agreement also details what actions will be taken should you breach these parameters. It explains, for example, what notices the company must give you and how much time you have to respond once notice is given.

What Should be Included in a Franchise Agreement?

First and foremost the franchise agreement should state that you are part of the franchise and that you have a fixed fee (your franchise fee) to pay in compensation for this privilege.

The franchisor has the right to approve or disapprove of sites for your location, but at the same time they will be obligated to assist you in the selection of a site for your business.

There will be a section in the agreement that goes over the use of the franchise name. Specifically, you may not challenge the franchisor's right to use the name and will be required to inform the franchisor if you discover someone else using the name without permission.

The franchise agreement also indicates how you will be expected to maintain the aforementioned uniformity.

Other Provisions You May See

The agreement will state the manner in which you must display signage at your locations. There may be certain requirements and/or restrictions on the use of a sign with the franchise name.

Often a section is included detailing what training and assistance will be provided by the franchisor. This section would go over the franchisor's responsibility to help a new franchisee get his unit going.

A franchise agreement may contain a section on advertising. Some companies use a national advertising fund to which you will have to contribute but will also benefit from during a national ad campaign. Additionally, many franchisors want to retain the right to review any and all advertising/promotional materials you may use to ensure-you guessed it-uniformity.

A section about the operating manual will require that you abide by it and adopt any revisions made to it by the franchisor. You will be under a confidentiality agreement concerning the operating manual-which remains the property of the franchisor-because the manual will divulge everything about the franchise's business plan.

It's in the best interest of the franchisor that his franchisees operate out of clean, well-maintained buildings, so there may be a section of the franchise agreement pertaining to maintenance and repairs.

The franchise agreement will have requirements concerning records and accounting. You will be required to keep certain records and to provide your franchisor with annual statements which have been audited by a certified public accountant (CPA).

Standards and quality sections-which can be very lengthy in some cases-will, again, provide for uniformity across the franchise system.

If the business opportunity you're availing yourself of requires a lot of labor or products that are produced at your location (this includes food), a franchisor will insist on quality assurance provisions. This, too, will be a lengthy section of the franchise agreement.

A section on modifications will basically state that the franchisor has the right to make system changes at anytime and require you to adopt them, but you, the franchisee, may not make any changes without approval.

The franchise agreement will specify what royalties the franchisee must pay for continuing to use the franchise's name and business plan.

The franchisor will have some amount of insurance it requires franchisees to carry, and this will be outlined in the franchise agreement.

Of course, there will be a section of the franchise agreement that states how long your franchise will last. In many cases, this term coincides with a lease, so if, for example, you have a ten-year lease on your building, you will have a ten-year franchise agreement. The agreements may or may not be renewed at the end of the agreement period at either party's discretion.

Something called a "covenant" section will state that you cannot use the knowledge and training provided to you by the franchisor to open an identical business that simply has a different name.

A section of your franchise agreement will detail what will happen at the end of the agreement including what rights each party has at that time. This section will also deal with actions that will cause you to be in default of your franchise agreement and, therefore, subject to termination by the franchisor.

The franchise agreement will state that you are required to obtain all permits, licenses, etc. necessary to conduct business in your area and that you must be in compliance with all local, state and federal laws. This section will also state that debts you incur in the course of doing business are your responsibility and not the responsibility of the franchisor.

A "nonwaiver provision" will explain that all provisions of the franchise agreement are enforceable at any time. Although a franchisor might not enforce a certain provision at a given time, they still reserve the right to enforce that provision at a later time. The same rule will apply to fees owed by the franchisee. If the franchisor does not accept payment from you for any reason, they will still have the right to collect on that debt at a later time.

Sometimes an arbitration clause will be included, although these clauses are disallowed in some states. If your franchise agreement does have an arbitration clause, it may require you to submit to binding arbitration in the event of a dispute.

Finally, the franchise agreement will designate you and your successors as the franchisee for that agreement and state that you are aware of the assumption of risk. The success of your business will not be guaranteed by the franchisor.

(ArticlesBase SC #169055)

Raymond Lawrence

Is buying a business franchise a right step for you? This question tends to crop up as the most crucial query in your mind, once you are struck with the idea of taking up a business franchise. Here, the point lies in recognizing your passion and interests in a particular field of business, and the willingness to accept the ongoing risks and other demerits 'sportingly'.

Business franchises in general is one of the best means to earn loads of money. However, as mentioned earlier you must spend considerable time to understand the intricacies of running a franchise, the selling aspects, the risks, the potential returns and other details - before you settle on to purchase a franchise business.

Here are some easy tips to help you decide 'whether a business franchise is your cup of tea'.

Area Of Interest - The very first and significant point while selecting a business franchise you have to consider is buy a franchise that you are interested in. This will further instigate you to gain further knowledge and skills required in the business. Once you become an expert you are more likely to succeed in your trade, since a specialist knows the essentials to run a successful business. While you blend pleasure with your task, your business turns a task of joy and not a chore. Eventually, your love will picture the enthusiasm you infuse in the trade and your customers will certainly notice this. People prefer to deal with enthusiastic sellers. Business is all about gaining the faith of your customers, and faith can readily come from the expertise you display. Since customers always trust experts. Thus, recognize your area of interest before starting a business.

Investment - Now, once you recognize your passion and field of interest next comes your investment part. Every business franchise has its individual cost. While selecting or planning to take up a business franchise, ensure that you can put in the requisite investment to initiate and continue the trade.

Knowledge - A true business owner must acquire selling skills. Yes, once you settle on to own a business training franchise you must know the basic marketing skills. To flourish your business and take it to the next level, professional selling skills are the need of the day.

Staff Selection - Apart from the above-mentioned aspects, another major section is selecting the best professionals to run your business training franchise. Pick up the best team members and make sure you have regular discussions sessions with them. Communicate your ideas and to-dos to run the trade, and make sure you welcome suggestions from the franchisors too.

If you find the above criteria's manageable then business franchise is definitely for you, so what are you waiting for there are numerous franchises for sale. Pick up the business franchise that interests you the most today.

When buying a franchise opportunity the choice is yours as to whether you are set up for life or losing your life savings so investigate, investigate, investigate.

(ArticlesBase SC #688284)

Matthew Franchise Anderson

If we search the internet for business franchise information, you can find thousands of franchise consultants, franchise websites etc, like www.franchiseselectuk.com, thus you will be getting a bulk of information. Today websites are the market place for these businesses. Selecting the appropriate franchise is the vital part of starting a franchise business. The franchise industry is one of biggest industries, so we should be careful before getting into it.

The first thing is to decide the franchise you are interested in. For that you must do your research on the franchise industry. Choose the franchise which is better suited for you and your personal skills.

There are various sources which provide better business franchise information. This includes, franchise websites where we can find the relevant franchise information. Franchise Select UK is one of the well known websites. The next one is attending franchise seminars, conferences etc. Thus you can mingle with the people who have experience in franchise industry. You will be getting invaluable information about running a franchise in a profitable way. The third one is the franchise publications, advertisement in newspapers etc.

If you have past experience in running a business, it will be an added advantage for starting a franchise. With that experience you will be able to manage the business properly.

Before starting a franchise you should collect all the possible franchise information. Franchise agreement details are the main thing to keep in mind. This will explain the way the franchise business is conducted and the nature of relationship between the franchisor and the franchise. Then comes the total budget required for your franchise. You should frequently update your knowledge regarding a franchise opportunity; this will help you for running the franchise in a better way.

(ArticlesBase SC #333967)

sam

The more I look into the Franchise Industry, the more it is apparent that most Information is geared around selling franchises. The Business Franchise is exactly that - big business.

If you do a search on Google on 'franchise' or 'franchise information' then you are likely to be presented with thousands of pages of franchise advertisers, franchise consultants, franchise marketplace websites and possible a franchise association.

I have been seriously researching the industry for a number of years now and the number of good information sources I have found are few and far between. There are a number of good books on Franchising on amazon and I strongly suggest that if you are seriously examining buying a franchise then you read as many as you can. You can never do enough research.

I have just come off the back of two days solid of research on google on franchises and I have yet to find any information sites that are not in some way 'sponsored' or funded by franchises or consultants.

Why is this? Do you know any?

The franchise Industry is big business and the opportunities to get impartial, informative advice and information are few and far between.

If you are considering buying a franchise then the biggest piece of advice I can offer is to consider the motivation of any article, web site and 'guru' that you come across. Do your due diligence and ask what their motivation is for providing that information.

To begin that process, let me give my honest answer:

I am writing a blog to give impartial advice from some one who has been a franchisee. I have seen the good and the bad of the franchise industry and have lost a lot of money.

I have spent the last three years, and more, fully researching the franchise industry and have been struck by the lack of impartial advice and information. I have a small vested interest as I am writing a manual on my experiences and how you can avoid them and will be launching it soon. Apart from that, however, I have no other interest in providing you information other than making sure you make the right decision for the rest of your future.

Learning about the franchise industry from honest people can give you every chance of success when researching and buying a franchise. Using the Internet to it's full potential as a tool for your research is a must and at the end of the day with the right knowledge in hand you can come away with a fantastic business for life which can support your and your family in the way that you want to live. Without doing the proper research it is likely you will buy into the wrong type of franchise for you or one which may well collapse in the near future, leaving a gaping hole in your pocket and with little no no resources left to set up fresh.

To your future business success.

(ArticlesBase SC #892045)

Matthew Franchise Anderson