Considering Becoming a Franchisee? Get Your Franchise Agreement Reviewed
A franchise can be a great business opportunity for many in people in Florida. By becoming a franchisee, you can use an already established business model to create real value for yourself and your family. When you buy into a franchise, you are creating your own business. That being said, your new business will be heavily reliant on the franchisor.
As such, you need to operate under a franchise agreement that effectively establishes your rights and fairly protects your personal business interests. With this type of agreement, you will be able to maximize your chances of success. Do not go through this process alone. Before signing on the dotted line, you should be sure to have your franchise agreement reviewed by an experienced West Palm Beach franchise law attorney.
Franchise Agreements are Negotiable
Once you get deeper into the franchise purchasing process, you will likely receive a copy of a proposed franchise agreement from the franchisor. Far too many people do not understand their ability to alter this agreement. The proposed franchise agreement that you are presented is not final. Indeed, it rarely a take it or leave it offer. If you see something you do not like in the franchise agreement offer, change it. You can add an addendum to the agreement, which will give the franchisor an opportunity to determine if your proposed changes are acceptable. Remember, your investment is valuable. You should not give it away lightly. Franchisees can and should negotiate for the best possible terms.
What to Look for in a Franchise Agreement
To effectively negotiate for better terms, prospective franchisees must first understand the important issues at stake in their agreement. This can be challenging, because franchise agreements are notoriously complex legal documents. For this reason, franchisees should always have their agreement reviewed by an attorney before signing.
Not only will your attorney deal with the complex legal aspects of your franchise agreement, but your attorney will also be able to clarify the rights and responsibilities of all parties under the contract. This will give you better perspective to assess whether or not the deal is truly fair. Franchisors will use their industry knowledge to craft an agreement that works best for them. You need an agreement that also works best for you. Some of the specific issues that your attorney will consider include:
- The franchisor’s obligation to provide training and ongoing support;
- Your total initial investment costs;
- The amount of royalties that you will owe under the agreement;
- Your ability to be protected from legal liability;
- Your right to keep exclusive territory for your business; and
- Your ability to transfer or sell your business interests.
Get Legal Help Now
At Pike & Lustig, LLP, our South Florida franchise law attorneys have extensive experience reviewing franchise agreements. If you are a current or prospective franchisee in need of legal assistance, please contact us today to set up your free initial consultation. We have offices in West Palm Beach and Miami and represent franchisees throughout the region, including in Port St. Lucie and Pembroke Pines.