Purchasing a Franchise
Thinking of purchasing a franchise?
Franchising a business is a most rewarding endeavour. From choosing a storefront to hiring employees, the potential income from a franchise can be lucrative. As lucrative as such a deal can be, there are some initial considerations to make when purchasing a franchise.
A few initial considerations include (but are not limited to):
- initial franchise fees (if any)
- monthly franchise fees
- annual franchise fees
- location of franchise
- creative direction of a franchise
- termination clauses
- rights under the franchise agreement
- transferring or selling of the franchise
While the points above highlight some of the initial considerations when purchasing a franchise, there are many other considerations to make. Other important factors include arbitration and legal forums. While disagreements under a franchise agreement are not something you want to think about when initially purchasing a franchise, the possibility of a dispute or lawsuit arising is a possibility especially when the terms of the franchise agreement were not clearly drafted or there has been miscommunication or a breakdown of the business relationship.
The other issue that may arise under a franchise agreement is the misuse of trademarks and patents. Most franchise agreements clearly lay out the terms and conditions with respect to intellectual property, but these terms are sometimes misunderstood or ignored.
As Canadian businesses have provided a wealth of opportunity for business individuals hoping to purchase established enterprises, clearly drafted franchise agreements have become a necessity.
If you’re planning on purchasing a franchise, get in touch with one of our attorneys Saidi Law Corporation today. Get in touch with us at 604-930-9578.