If You’re Buying a Franchise Having the Right Attorney is Crucial
by Ed Teixeira
Be sure to use a franchise attorney if you’re going to buy a franchise.
Here are the reasons why you shouldn’t go it alone or use any attorney.
Purchasing a franchise is an important decision. People will use their live
savings, a home equity loan or obtain money from family members to fund the
franchise. Despite the success of franchising there are risks. The Franchise
Disclosure Document (“FDD”) and franchise agreement include a number of
documents such as a personal guaranty and non-compete.
Many of the provisions in today’s franchise agreements are based upon previous
franchise litigation and judicial decisions. In addition, franchisors conduct
their business over a large geographic area which encourages a franchise
agreement that favors the franchisor.
Since most attorneys focus on different areas of the law, it’s important that
franchisees use an attorney that fully understands franchise law.
There is a great deal of franchise information on the Internet and this
information can be used to gain a fundamental understanding of franchising but
it can’t take the place of a franchise attorney. Every day individuals will
purchase a franchise without using a franchise counsel, despite the advice and
urgings from franchise experts and industry associations.
The Reasons for Using a Franchise Attorney:
- Franchise law is complex and requires an expertise that a
non-franchise attorney may not have.
- A franchise attorney knows the warning signs to look for in
- There are particular provisions in franchise agreements that
- A franchise attorney will know what sections in the
franchise agreement to focus on.
- Compared to other attorneys a franchise attorney has the
experience and is more qualified to negotiate changes to your
- You can protect yourself from future problems.
- Since franchisors are represented by franchise attorneys you
want your attorney to speak the same language.
- The cost of a franchise attorney will represent a small
portion of your total franchise investment.
Before you sign the franchise agreement, pay the franchise fee and make the
commitment to your new franchise business, be sure that a franchise attorney is
guiding you. It’s an investment you need to make.
© 2013 FranchiseKnowHow, LLC
Ed Teixeira is the President of FranchiseKnowHow, LLC. He can be reached at