Yes, you should enter into a contract agreement without a franchise attorney by your side. Although there are many great lawyers in the world, and you may even be related to or good friends with some, the particulars of the FDD and the Franchise Agreement are such that you will want someone on your side who can understand all of the legalese and help you to solve problems even before they arise.

  1. Review the FDD with a competent attorney.
    The Franchise Disclosure document covers 23 items that you need to understand and agree with before you sign off and purchase a franchise. Several of the important elements are listed below.
    • Fees: As you would expect, there are numerous fees when it comes to opening a franchise. Have your lawyer review the start-up fees and your economic responsibility for the franchise to run. You can expect to pay royalty fees but also may be responsible for technology fees or branding fees. A well-trained franchise attorney will help you gain a fair monetary agreement before you sign the contract.
    • Rights: When you purchase a franchise you will gain the rights to use the branding and models of the business. Your franchise attorney will make sure the rights are outlined appropriately.
    • Non-compete clause: If you enter a franchise contract you will likely need to sign a non-compete clause so you do not try to open a business that is similar in scope while you are working for the franchisor. This will usually last for a period of several years after you terminate the franchise agreement.
    • Territory: Your franchise attorney will help you understand what territorial rights or rules there are when considering the franchise. You may be limited to a specific geographical area or there could be certain zip codes where you are not allowed to go. Your qualified franchise attorney will help you figure this out.
  1. Franchise agreements can be negotiated.
    A franchise lawyer like those at Drumm Law can read the Franchise Agreement before you sign on the dotted line, and can draft a list of items to that may be of concern. There are many items that can be negotiated and your franchise attorney can make the most of the franchise agreement on your behalf. These items include:
    • The negotiation could limit the responsibility that is incurred, personally, if a franchise closes.
    • A franchise lawyer can help you by lengthening the time a franchisee has to open the store.
    • An addendum could expand or outline the territory in which you are allowed to open your franchise.
    • The negotiation could permit transfers for real estate.

At the end of the day, hiring a franchise attorney like Drumm Law will save you time, money and hassle as they truly read and understand your FDD and Franchise Agreement.