When you are thinking to explore a franchise opportunity, your franchisor will give you two crucial documents i.e. a franchise agreement and an FDD. According to law, the franchisor must handover an FDD file to you at least 14 days before signing the franchise agreement. The FDD is complex and lengthy too and so, you need a good time to understand and agreed to every mentioned clause before signing up the agreement. In order to understand everything mentioned in the FDD, you need to consult a Franchise lawyer related to your business. If you are interested in buying a restaurant franchise, you must consult with an experienced restaurant franchise attorney to understand the clauses in a better way. To keep your franchise business safe and sound from all financial and legal implications, consulting an experienced franchise lawyer is a must. He can easily highlight the clauses that can be a reason of problem in future for you. They ensure your rights are reserved in the best possible manner. Here are five reasons to hire a Franchise lawyer before signing a franchise agreement 1. Franchise agreement should be a copy of FDD Numerous issues need to be checked in FDD’s clauses, but from all, terms and conditions should be carefully viewed by your franchise lawyer. The problem stands for the franchisee when franchise agreement says one thing and FDD says something else. 2. To know the franchise agreement termination clauses The termination of the franchise agreement from franchisor's side can be easily known by reviewing the FDD file in detail. You, being a franchisee, need to know under what conditions, franchisor can terminate the franchise agreement. In every franchise agreement, termination clause is discussed in detail. Read it carefully. 3. To know what will happen if franchise agreement expires? Every agreement including franchise business has its expiry. In this case, renewal of the agreement is desired to continue running the business's operations, but for that, you need to satisfy certain conditions. 4. Your territorial rights should meet your expectations You should contact a franchise lawyer to ensure your territorial rights are preserved according to your expectations. 5. To understand crucial points in the franchise agreement If a dispute occurs between you and your franchise agreement, FDD clauses will tell you what steps need to be taken by you.
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Multifarious factors boost the global brands to enter into the Indian master franchisees arrangements. The reasons are many but the major reasons include the advantage of acquaintance of the master franchisee with home environment; local sales and marketing proficiency of the master franchisee. The all set accessibility of sales and marketing channels; less investment; insignificant government permissions are some other reasons that why Indian Franchisees are working with global brands. To further, make it a win-win situation, the regulatory limitation on retail trading by the foreign firms is a key factor for the sudden rise of master franchising arrangements in India. As per the arrangement, a Master Franchise Agreement would generally manage the:
From an agreement point of view, while making the agreements, a franchisee must attempt and overpass all probable gaps by recognizing and analyzing most queries or situations. For any global brand who is willing to start their business or want to open franchise store in India should consider discussing it with the professional franchise law firm. To know about the Indian Franchisees visit https://www.franchise-law.com/ Franchise litigation is more dangerous for the franchising society as compared to franchisee/franchisor relationship. The franchisor has undoubtedly an upper hand in the case because of stronger lawful guidance and greater economic resources. The process of litigation goes through a sequence of steps to resolve a dispute. Litigation involves all legal steps involved in settling a dispute between two or more parties. Through this process, the franchisee can take legal action for the damages. So, it becomes crucial to hire a highly-experienced franchisee attorney for all the legal matters. There are many business law firms which are involved in providing legal services for business, litigation, business franchise law and so on. Franchise lawyers also help you in dealing with particular business operation cases. Litigation lawyers, Car Accident lawyer, Trademark Registration lawyer, Franchise lawyers, Motor Vehicle Accident lawyers, etc., are some franchise litigation services. The lawyers related to franchise business provide the reliable and affordable legal service for your legal matters. To provide online support to the clients, these law firms provide the legal consultancy through the website. In case of any type of legal consultancy needed, you can visit these legal websites to find an effective solution. In franchise litigation, you can also hire them to represent your perspective on the court. In legal matters related to the franchise, it is highly recommended to hire a franchisee attorney from a reputed law firm like Franchise Law as soon as possible to take the upper hand to bring the matter into the notice of the honorable court. Only arguing parties have the right to make the final decision on the mode of dispute resolution. It is always good to do a little research prior to opening a franchise to avoid such situation to arise in future. Franchise litigation is the last option left with the parties to settle the franchise dispute. To ensure your success, a knowledgeable and experienced franchisee lawyer is always needed. If in case you are facing problems with your franchisor then don’t sign any document describing dispute resolution. Franchisors usually offer a small concession to help you but extract a definite amount of claim and other factual representations in return. It is normally seen that the franchisees experiencing financial problems in their franchise business usually approach the franchisor for help. After giving veiled threats of taking the franchise back from the franchisee, the franchisor agrees to help by making a small amount concession by delaying the payment and reducing the minimum royalty amount for a short period of time. In this situation, franchisee out of desperation, sign the agreement as they were explained by the franchisor that if they fail to sign the agreement, they could lose their business rights. In this particular situation, there is an urgent need to consult an experienced franchisee attorney before signing. Because of lack of consultation, franchisees did not find the “boilerplate” clause inserted by the franchisor. In the agreement, franchisor inserts the clause that says franchisee had consulted with a business lawyer and they had no claims against the franchisor for anything whatsoever and even the franchisor had never done anything wrong. The franchisor makes sure to add in the agreement a general release from all claims. In every part of the world except Washington, a general release is enforceable against the franchisee. The attempt of the franchisor to force you to sign on those false “representations” that says you have consulted one of the Franchising Lawyers prior to signing the document, actually it can make the situation even worse. In many situations, it is suggested to the franchisee to confront their genuine disputes with the franchisor rather than going to take the offered benefit. The benefits offered by franchisor rarely protect the franchise business from failure; in fact, they work more as a protective shield for any wrong act of the franchisor. In a nutshell, if you are going for renewal of the franchise agreement with your franchisor, it is crucial to consult your franchise attorney with your renewal document. Ideal franchising agreements always preserve the rights of both, the franchisor and franchisee. The profit earned by a fair means with satisfaction is the key to success of any franchise business. But, this scenario is rarely seen nowadays. At any instance, there is a clash between the franchisor and the franchisee, everything turned up into a dispute. An unhappy franchisee could definitely harm the franchise business while the franchising firm is always on upper hand than the franchisee when it comes to taking legal resources. Owing to this, franchising organization takes the utmost benefit at the time of franchise disputes. Irrespective of the results, franchise litigation is definitely very much dangerous for the franchising organization. It is reflected in the firm’s FDD and this persuades the investor’s decision. This risk is sometimes considered beneficial for boosting the position of the franchisor. On the whole, we can say litigation is having both sides i.e. good and bad for franchising organization. The franchisor or the business owner always has good economic resources and because of this, access to the stronger guidance of law. The process of franchise litigation involves the steps that may lead to a court trial to settle the dispute. In many instances, franchisees may show their disagreement when they have legal trials. Arbitration and Mediation Arbitration and Mediation are the two easiest ways to resolve the dispute between franchisor and franchisee. Sometimes, the franchisor wants to end up the dispute as soon as possible as this affect their reputation among the investors. Mediation and arbitration have a tendency to be more on franchisees side than franchisors. If the franchisor thinks that arbitration process could go in favor of franchising organization, they may try to go for this option while if they think they are weak somewhere, they prefer to go for litigation. Many franchisors normally prefer to keep their options open by being comfortable to stress on arbitration and mediation procedure where they think the process is in favor of franchising organization but, these firms thrust into litigation where they think arbitration and mediation would possibly go against the franchisor. This comfort keeps the franchise on the upper hand and due to frustration, franchisee starts working against the best interest of the franchise owners. So, it is extremely important for the franchisees to recognize their status while lodging the complaints against franchisor to settle the dispute. A franchisee attorney can help you in settling the dispute by preserving your rights Restaurant industry is the second largest private sector when it comes to employment after the Government. Many people desire of owning a fast food business or restaurant because it is remarkably profitable. Undoubtedly, the food industry remains one of the most gratifying businesses on the planet. The best ways to cash in on this opportunity to possess a food outlet or restaurant is buying a franchise. This would reduce the risks and any failures. Adequate training is provided and support is offered. There are several benefits of purchasing a franchise. However, it also requires lots of hard work, determination and skills. Before hopping to any such decision it is important to look at various things and consider. It is important to develop the skills and aptitudes if you want to get into the business. Learn and understand the culinary business, undergo the various training sessions with the franchisor and so on. The entire process may take few weeks or months. Always try to go for a brand that has a record of accomplishment for success and repeat customers. Make sure that the management team of the respective brand is willing to answer all of your questions and concerns. Look for the franchise law firms especially for the restaurant franchising. Restaurant law firms are the experts and connoisseurs of dealing inside out of franchise agreements. They can assist you in finding the right and suitable franchisor. Look for the trustworthy law firm; try to seek some referrals or testimonials. For additional information on restaurant law firm visit www.franchise-law.com |
AuthorMr. Herman has lectured at the First Annual Franchise Conference held in Shanghai, China in October 1998. He has also lectured on Franchising Issues in San Jose, Costa Rica in September 2001, and with the ABA Forum on Franchising in Orlando, Florida in October 2005. Archives
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