ABA Family Legal Guide

Forming and Operating a Small Business

Franchising and Buying a Business

Buying a Franchise

What is the franchise agreement?

The franchise agreement is simply the contract that governs the franchise. From the franchisee's perspective, franchise agreements are rarely friendly. The franchisor and its lawyers draft them, and they're intended to protect the franchisor's interests. They are typically very lengthy (over thirty pages) and very detailed when spelling out the franchisor's rights and your obligations, but sketchy as to what are your rights and theirobligations. Your lawyer can guide you through the complexities and pitfalls of a franchise agreement.

Depending on the state of the market and the type of franchise, it may be possible to negotiate some terms of the franchise agreement. It's certainly worth trying.