Signing a Franchise Agreement: 3 Key Considerations


Entering into a franchise agreement can be an exciting and lucrative opportunity for aspiring entrepreneurs. However, it is essential to approach such agreements with caution and a thorough understanding of the terms and implications involved. Falcon Law PC, a trusted law firm specializing in franchise law, is here to provide valuable insights on three key considerations to keep in mind when signing a franchise agreement. Contact us at 1-877-892-7778 or to discuss your franchise needs and receive expert legal guidance.

1. Franchise Disclosure Document (FDD)

The Franchise Disclosure Document (FDD) is a crucial document provided by the franchisor to the prospective franchisee. Before signing the franchise agreement, carefully review the FDD and consider the following aspects:

  • Financial Obligations: Understand the initial and ongoing financial obligations associated with the franchise. This includes the initial franchise fee, royalty fees, advertising fees, and other financial considerations. Ensure that these obligations align with your budget and financial capabilities.
  • Territory and Competition: Examine the territory rights granted by the franchisor. Understand the exclusivity of your territory and any potential competition from other franchisees or the franchisor’s own company-owned outlets. Clarify whether territorial protections are in place and the extent of your exclusive rights.
  • Franchisor’s Obligations: Evaluate the franchisor’s obligations, such as providing initial training, ongoing support, marketing assistance, and operational guidance. Ensure that the franchisor’s commitments align with your expectations and that they have a track record of fulfilling their obligations to other franchisees.

2. Franchisee Rights and Responsibilities

As a franchisee, it is essential to understand your rights and responsibilities within the franchise system. Consider the following elements:

  • Operating Standards: Familiarize yourself with the franchisor’s operational standards and guidelines. Understand the expectations regarding product quality, customer service, branding, marketing, and other operational aspects. Determine whether these standards are reasonable and achievable for your business.
  • Renewal and Termination: Review the terms and conditions regarding the renewal and termination of the franchise agreement. Understand the process, notice periods, and any conditions that may affect your ability to renew or terminate the agreement. Pay close attention to any non-compete clauses that may limit your options after the agreement expires or terminates.
  • Intellectual Property: Understand the extent of the franchisor’s intellectual property rights and your rights to use and promote the brand, trademarks, and proprietary systems. Clarify any restrictions or limitations on your ability to modify or adapt the franchisor’s intellectual property.

3. Legal Assistance and Review

Given the complexities of franchise agreements, seeking legal assistance is highly recommended. Consider the following:

  • Franchise Attorney: Engage a qualified franchise attorney to review the franchise agreement and advise you on its terms. A franchise attorney can identify potential issues, negotiate on your behalf, and ensure that your rights are protected.
  • Negotiation Opportunities: Work with your attorney to negotiate certain terms of the franchise agreement, such as initial fees, royalty rates, renewal conditions, and territorial protections. A skilled attorney can help you achieve a more favorable agreement that aligns with your specific needs.
  • Understanding Legal Implications: Ensure that you fully understand the legal implications of signing the franchise agreement. Your attorney can explain the obligations, restrictions, and potential risks associated with the agreement, helping you make an informed decision.

Why Choose Falcon Law PC?

At Falcon Law PC, we specialize in franchise law and have a deep understanding of the intricacies involved in franchise agreements. Here’s why our clients choose us:

  • Experience and Expertise: Our team of skilled franchise lawyers has extensive experience representing both franchisors and franchisees. We understand the nuances of franchise agreements and can provide comprehensive guidance tailored to your specific situation.
  • Thoroughness and Attention to Detail: We conduct a meticulous review of the franchise agreement, ensuring that all key terms are analyzed, explained, and negotiated to protect your interests.
  • Personalized Legal Solutions: We take the time to understand your franchise goals, concerns, and expectations. Our personalized approach allows us to provide tailored legal solutions that best serve your unique needs.

Contact Falcon Law PC Today

Ready to embark on your franchise journey with confidence? Contact Falcon Law PC at 1-877-892-7778 or to schedule a consultation. Our experienced franchise attorneys are dedicated to providing you with the legal guidance and support you need for a successful franchise endeavor.

For inquiries or further assistance, please contact us using the information below.

Talk to us now at

Book a consultation fast and easy