A Franchise is a common trend in business nowadays. Even with the most famous restaurants and fast-food chains, you can have a franchise if only you can afford its cost. It is an easy way to have a business having an established brand or name. Because of it, it will be easy for you to have many customers that will buy from you. The business has long been established and you can share its fame and can get profit from it by having a franchise of this business. But before you enter into a franchise agreement contract, you may want to have a franchise agreement checklist. This will guide you of all the things that you need in having a franchise business.
A franchise agreement checklist is a list of things that you need when you are having a franchise contract agreement. These are the important things that you have to settle before you can have your franchise business. Anyway, what is a franchise agreement? A franchise agreement is a document that gives consent to use the enterprise name by an individual. It means that if you have a brand identity, someone can have a franchise or buy a branch of your business and use your enterprise name. Through franchise, your company system can also be used. A franchise agreement is common in food stalls, fast-food chains, and restaurants. There can be also a hotel franchise. Whether you will have a sub-franchise or you will be a master franchisee, you need to enter into a franchise agreement for you to have the franchise of the business. There can be also a checklist that you need to follow to be sure that you can meet the requirements for franchising. The franchisor needs to ensure that you will be qualified to have a franchise of his or her business. With the checklist, you should also know what you should do to start the franchise. It consists of necessary steps that you need to accomplish or go over first before signing a franchise agreement.
If you have seen a sample of franchise agreement or a sample of a franchise contract, maybe you have an idea of what a checklist of a franchise agreement is all about. But in case you do not have an idea at all, here are the things that you should put in a franchise agreement checklist:
You must not forget the fees that you are going to pay in your franchise. It may include the franchise fee, the royalty fee, and other costs that you have to pay. You need to prepare money for these fees for you to be able to make a franchise. It is one of the first things that you have to give importance to make a franchise. Before considering any franchise business, you need to prepare your money so that afterward you can choose the franchise business that you like. This will be your capital in starting your business. Small franchises like food stalls may need a small amount of capital, but bigger franchises like fast food-chains require a considerably large sum of money. In choosing a franchise business, you must consider the brand identity and you can tell whether the franchise price is high or reasonable. Franchise a business that you know you can get profit. With this, you may consider making a franchise with a business that has a popular name only.
The things about intellectual property must be clear. You must know if that through your franchise, you will have a right for it or not. You can research how you can settle things about intellectual property. You need this thing before you can make a franchise agreement contract with the franchisor. Things about intellectual property are having a license with logos, trademarks, and using business systems.
You must know how you can conduct training for your employees. Your franchise business should have uniformity with the business of the franchisor so you have to make sure that you will not go far from it. You need specific instructions on how you can do this thing. You must discuss this with the franchisor and should learn the strategies on how you can train your employees.
Hand in hand with training, you must know how you can do operations for your franchise business. It must not go far from the system of the original business. You have to conduct all your business operations according to the system of the franchisor. From management to staff, you need to know how you can do things.
You need to discuss the length of your franchise. If you can have it in a considerable short time, you may want to ask how you can do renewal of terms. The length of the franchise may be according to the franchise money that you can give. If you are not sure about the business, you can start with a short matter of time to agree with. But if you know that the brand is a good one, you can set a length of the franchise that will last for many years.
You must also settle terms about termination. If you can see that you are not going anywhere with the franchise and you want to stop the business, you may want to put a clause about termination. This clause should be something that both parties will agree upon. You must set clear boundaries on how you will end the agreement.
Franchisors may have some rules in franchising. They may not want you to work in other companies that can give competition to their business at the time that you are having a franchise with them. They can make a non-compete agreement that they will make you sign to ensure that you are going to follow their rules.
There can be requirements that you have to adhere to after the term of your franchise. You may need to return confidential things or some intellectual property materials. Sometimes, you may need to pay some fees. You need to be clear about post-term conditions so that there will be a good closing with your relationship with the franchisor.
As you are having a branch of the business of the franchisor, the next question can be ‘Where will your franchise be located?’. You must discuss with the franchisor your territory. Will the franchisor put another branch near your location or you will have the territory in that place? You need to discuss this because it can affect your target market. You can have a better market plan if you can own a territory. So, it is up to you to negotiate about this thing.
Your franchise should be a complete replica of the business of the franchisor. You have to discuss how it can be possible. Ask for all the suppliers that can do the construction of your business. The franchisor may even make the process easier for you by providing all you need.
You are going to manage your own business but even things about advertising must be uniform with the business you have franchised. You have to get the style on how your business can be advertised. But in regards to the marketing strategy, you can make some changes. Though you still need to copy some strategies from the franchisor. Tackle things about the marketing plan and sales plan.
Even it is a franchise, you need your business to be insured. Discuss things about insurance because insurance can guarantee the safety of any business. Ask how the franchisor is having insurance for his or her business and you may want to have the same insurance for your franchise.
The franchisee must pay the franchisor if ever he or she has done something that can ruin the reputation of the business. You must talk about the indemnification clause so if ever damage to the business will happen, both of you will know what to do. You can settle the matter quickly through the indemnification clause.
Things happen. The franchisor should know what to do if ever you will die or become incapacitated. Who will handle the business? Will you hand it over to your family? There should be a complete discussion about this so that the franchisor will not be left clueless if ever unexpected things happen.
Aside from reviewing any franchise agreement example or franchise contract sample to make your agreement, you may want to have some tips that you can use in making a franchise business. Read the following and consider the tips that you can use as you make a franchise:
After you are through with the franchise agreement terms checklist, you may want to know how you can start your franchise business. You may consider the following steps in starting a franchise:
To get the best franchise business, you must research the market about which franchise can work best for you. If you want a food business, you may consider having a franchise business of a restaurant. Your selection must depend according to the goals that you have. If you want to earn the biggest profit, then you can choose to have a franchise of a business that has a popular brand identity.
You should know what works and what does not work. Research the market so that you will know what franchise business can truly give you a profit. With market research, find the franchise opportunity that will be best for you.
When you have already selected the franchise business that you want, you must make a business plan. Through it, you can have a roadmap that you can follow as you will run the business. Research document templates about business plans and you can start making the business plan that can guide you.
After you have obtained your capital and after making a financial plan or financial strategy, you can now sign a franchise agreement. You may want to know why a franchise agreement is important. It is essential because you are borrowing an enterprise name. A contract is vital because everything must be settled in documents.
The next thing that you have to do after signing the agreement is to start running the business. Hire employees and get them trained. Start the operation having the hope that you can keep up with the expectation of the business of the franchisor. When everything is done, you can start to publicly open your franchise.
The cost of a franchise depends on the business that you are going to have. On average, it may cost $35,000. But some franchises cost over $100,000. Just look if the business will be reasonable for the price quote so that you can be sure of profits.
Certain things are included in a franchise agreement. It includes the franchise price, the length of the franchise, the territory, termination clause, indemnification clause, and post-term requirements. Sometimes, you can find what you should include in a franchise agreement checklist.
If you are a new entrepreneur, you may consider having a franchise as your business. You can ride on the popularity of the franchise business. You can be sure of customers because the business has already been there. Do you need a template of franchise agreement checklist? This post can provide that. It has 3+ SAMPLE Franchise Agreement Checklist in PDF. Download now!
A handover checklist ensures a smooth and efficient transfer of responsibilities from one individual or team to another. It is particularly crucial during job transitions, project handoffs, or task…
continue reading
A Housekeeping Checklist is a systematic guide used to ensure cleanliness, order, and maintenance in various spaces, such as homes, hotels, or workplaces. This sample checklist outlines tasks to…
continue reading
