Untitled Document




Tips on franchise agreements

The franchise agreement is crucial. Don't sign any agreement, or pay any fees or deposit, until you have taken legal advice from a solicitor. Get a specimen contract for them to review.

Areas covered by a typical agreement

  • Term - how long does the franchise last? Will you have the option to renew it, and on what terms?
  • Territory - what area does your franchise cover? Do you have exclusive rights to sell within it?
  • Fees - what initial fee will you pay? What royalties will you pay on sales? Will you pay a regular management fee? Will you have to pay other costs? How are the costs worked out?
  • Support - how much help will you get starting the business? What continuing support will you get?
  • Restrictions - what restrictions are there on what you're allowed to do and how you must run the business?
  • Exit - what happens if you can't continue in business for some reason - perhaps due to ill health? What happens if you want to sell your franchise?