Franchising is a way to expand your business by licensing certain rights to a third party. Most often, the rights you will license are the rights to use: (i) your principal trademark; (ii) your “trade dress,” or the total image of your business; and (iii) your “know-how,” or your methods for operating a business. The third party will use those rights to open and operate his or her own business. In exchange, the third party will pay you various fees and will grant you the right to control certain aspects of the way he or she operates the business.
Franchising offers you more than significant financial rewards: it also allows you to grow much more rapidly, share risk with your franchisees, obtain greater economies of scale in purchasing, enjoy increased motivation at each location, and get better ideas from the field.
Franchising lets you bring talented, entrepreneurial team players into your system as franchisees. The relationship between you and your franchisees is one of mutual interest. Franchisees bring their individual talents, like expertise in e-commerce, customer relations, advertising, management, marketing, and supply chains into your system. They are motivated to share their talents with you, because it is in their interest to build your brand and help make the entire franchise system more profitable.
To bring your system to the franchise marketplace, you will, among other things:
A skilled and experienced franchise law specialist can help you coordinate all of these activities, can help minimize your costs, and can help bring your franchise to the marketplace quickly and efficiently.
The franchise law specialist can also draft franchise documents that are integral to your success. Your documents should protect you and your system. They should be clear, precise, and accurate. They should anticipate problems before the problems arise. They should comply fully with the Franchise Rule promulgated by the U.S. Federal Trade Commission (the “FTC”), and with the laws of all applicable jurisdictions where you offer franchises.
These franchise documents include:
At The Johnson Franchise Law Firm, our concentration is on franchise law and the business of franchising. With over 30 years of experience in law and 10 years’ experience in business, franchise lawyer Rick Johnson understands franchise law and business. He applies this experience to guide your company through the franchise development process. To take your business to the next level through domestic or international franchise development, please contact The Johnson Franchise Law Firm today.