Buy a Franchise

Why should you hire a franchise lawyer before you buy a franchise?

You finally found the perfect franchise opportunity. A business that you are passionate about and that’s promising. You’ve run the numbers and talked to other franchisees and the return is great. You might even be thinking, “what could possibly go wrong?”

When you are a prospective franchisee (you are still in the investigation phase) everyone around you has a financial incentive to convince you to buy the franchise. Brokers earn a living off franchise sales and franchise systems rely on steady growth to stay financially healthy. Even current franchisees might want to inflate numbers to save face.

Buying a franchise is a long-term commitment that can occupy a large part of your life (often 10 years for the first term, plus another 5 for renewals). Just like you would never buy an expensive home without an independent appraisal third-party inspection, you should not invest in a franchise without the help of an independent advisor like a franchise lawyer.

Here are the top 5 reasons why you should hire a franchise lawyer before buying a franchise

1. The Franchise Disclosure Document and Franchise Agreement are over 200 pages. Do you really want to read 200+ pages of legal documents? Really?
(See What a Franchisee Prospect Needs To Know About an FDD)

2. Franchise Agreements are like leases. You are making a multi-year commitment. You can’t “get out” if you no longer want to operate the business (or the building) without selling (subleasing) or buying your way out. A Franchise lawyer will let you know what you are committing to.

3. Franchise Agreements in general do not favor franchisees. You already have one strike against you. Let a franchise lawyer make sure your specific franchise agreement does not have a strike two and three as well.

4. Franchise lawyers know where the bodies are buried (i.e. they know what to look for in an FDD and Franchise Agreement). Do you know what is supposed to be in a franchise agreement and what is not? A franchise lawyer does.

5. Franchise lawyers know what is negotiable and what is not.

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Now that you know why you should hire a franchise lawyer, you need to know when:

When Should I Hire a Franchise

Drumm Law makes the franchise process easy with our flat fee FDD review package.

Our FDD Review Process