One of my first coaching clients in Darwin was Leah from FamFitNT who was interested in establishing a franchise network around Australia. The current business model was offering family fitness classes, personal training, and programs for kids of all ages in schools, councils and private group classes.

Together, we set about streamlining the business model into a system that could be easily taught to a new franchisee who had the basic fitness qualifications to run the business themselves. We looked at a new name, as the current name wasn’t available to trademark, so once we made the decision to limit the business to just classes for kids, it was easy to come up with the new name “Kids-Fit Australia”.

The business has now been streamlined to offer kids classes to pre-schools, primary and secondary schools. There are also programs for school holidays, councils and other organisations on demand, as well as a one-off six-week family challenge.

Leah is now focusing on building her Franchise Training Manuals, with the aim to eventually sell the Darwin branch and building the second franchise herself.

From a legal point of view, there are a number of factors business owners should consider in setting up a new franchise network. It is recommended you speak to a franchise lawyer and your accountant to ensure you follow the correct steps in establishing a franchise system.

Franchise Concept

Many successful franchise models are founded on easily replicable business models. For example, a fruit juice franchise network requires a stall in a busy shopping centre and supplier agreements with fruit suppliers. If you are considering expanding into a franchise model, you should have a unique concept that is not only easily replicable, but also flexible enough to attract customers or clients in different environments (geographic and demographic factors).

Franchise Documents

Setting up a franchise network will require a suite of franchise documents, including a Disclosure Document, Operations Manual and Master Franchise Agreement. These documents will set out not only your processes, but also protect your franchise assets (including systems and intellectual property). A Franchise Agreement is key in setting out the rights and obligations between franchisees and the franchisor. It is often the first contract a potential franchisee will read before they commit and therefore important it is drafted in consultation with key stakeholders in the franchise network. Notably, these documents should be drafted by a franchise lawyer who understands your industry and how you plan to operate your business.

Relationships with Franchisees

Without a doubt, your franchisees will be key to the success of your franchise network. As franchisees effectively take control of their franchises, you should choose franchisees with experience in running businesses, and are motivated to carry out your vision. As your franchise network grows, you should keep communication channels open with franchisees and keep them updated on news of the franchise. You should also consider training and developing franchisees regularly.

Key Takeaways

Expanding a business into a franchise network can be very exciting, yet also challenging. Whether you are running family fitness classes or a personal training business, a franchise system may be the right structure for you to take it to the next level to grow your brand. If you have any questions about setting up a franchise, call LegalVision’s franchise lawyers on on 1300 544 755 or fill out the form on this page.

About LegalVision: LegalVision is a tech-driven, full-service commercial law firm that uses technology to deliver a faster, better quality and more cost-effective client experience.
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