5 things you
need to know
Franchising Your Business
- Many successful business owners decide to franchise their businesses to grow quickly, with motivated franchisees leading expansion. For the right business, franchising can be a game changer, building scale quickly in a way that would not be possible simply with organic internal growth.
- The key to building a successful franchise is recruiting great franchisees. Your franchisees are the face of your business, building your brand and delivering your product or service to your customers. Recruit well and develop your first franchisees into brand ambassadors and your franchise is likely to be successful.
- Franchising is governed by the Franchising Code of Conduct, which means your legal structure must be set up by a lawyer with a detailed knowledge of the Code. Your franchise documents must comply with the Code requirements, so that your business is based on a firm legal foundation.
- The two key documents when franchising your business are the Franchise Agreement and the Disclosure Document. Your lawyer will draft both of these with your input. You will also need to create a detailed operations manual for the franchise, which sets out the specific details of how the franchise is operated day to day, such as exactly how products are made and provided to the consumer.
- Franchising is a complex area of the law, and an experienced franchising lawyer will provide two valuable types of advice – (i) what the Code requires and (ii) insight into market practice for comparable franchise systems in the real world.