The Operations Manual is a key document of the franchise suite. It’s the document that will detail the franchise system and procedures which all franchisees are required to adhere to. While our franchise lawyers have not seen a copy (these things are highly confidential!), we are pretty sure the obligation to offer ‘fries with that’ is a fundamental piece of the McDonalds franchise operations manual. This article will look at franchise operations manuals and how franchisors can draft a good manual.

But drafting, updating, and distributing an operations manual is not simply a process of writing down what you do in the franchise business. Thought needs to be given to the legal considerations, including the application of applicable law, and contractual rights of the parties. If you are a new franchisor and are creating your very first operations manual or an existing one tasked with the job of bringing the document up to date, here are some key tips:

1. Keep it Confidential – before you provide a copy to anyone, have them sign a deed of confidentiality or similar. After all, the content of the manual is the very system you are expecting franchisees to pay to exploit.

2. Use a Template or Checklist – if you simply rely on your existing business knowledge, chances are you will miss out on some important inclusions in your manual. Have you thought about privacy? Occupational health and safety? Ongoing systems updates? All of these are topics regularly covered in the manual. A great template is published by the Franchising Council of Australia.

3. Make it Match your Franchise Agreement – the two documents should be carefully cross-checked to make sure there is no inconsistency. When a new franchise is signed on, they often receive the Operations Manual at the same time as the Franchise Agreement.

4. Be wary of Making Promissory Statements – your operations manual, in effect, represents a binding contract by the inclusion of a reference to same in your franchise agreement. Accordingly, you should avoid making statements that are promissory in nature, such as expected turnover or the provision of ’24 hour franchisor support.’

5. Be Aware of your Right to Update – unless your franchise agreement contains an express clause permitting updates, it is questionable whether you have a contractual right to do so. Some franchise agreements contain caveats to this ability, for example that any major updates only occur after consultation with the franchise network.

6. Be Mindful of Good Faith – updating the manual is an act governed by the Code, including the statutory obligation of good faith. Accordingly, updates which alter the way the franchise business is conducted should not be made on a whim, and only after consideration of the effects of same on individual franchisees.

If you need assistance with drafting a operations manual or any other step in setting up a franchise, get in touch with LegalVision’s franchising lawyers by calling 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.

The majority of our clients are LVConnect members. By becoming a member, you can stay ahead of legal issues while staying on top of costs. For just $199 per month, membership unlocks unlimited lawyer consultations, faster turnaround times, free legal templates and members-only discounts.

Learn more about LVConnect

Emma Jervis
Get a Free Quote Now

If you would like to receive a free fixed-fee quote or get in touch with our team, fill out the form below.

  • We will be in touch shortly with a quote. By submitting this form, you agree to receive emails from LegalVision and can unsubscribe at any time. See our full Privacy Policy.
  • This field is for validation purposes and should be left unchanged.
Our Awards
  • 2019 Top 25 Startups - LinkedIn 2019 Top 25 Startups - LinkedIn
  • 2019 NewLaw Firm of the Year - Australian Law Awards 2019 NewLaw Firm of the Year - Australian Law Awards
  • 2020 Fastest Growing Law Firm - Financial Times APAC 500 2020 Fastest Growing Law Firm - Financial Times APAC 500
  • 2020 AFR Fast 100 List - Australian Financial Review 2020 AFR Fast 100 List - Australian Financial Review
  • 2020 Law Firm of the Year Finalist - Australasian Law Awards 2020 Law Firm of the Year Finalist - Australasian Law Awards
  • Most Innovative Law Firm - 2019 Australasian Lawyer 2019 Most Innovative Firm - Australasian Lawyer
Privacy Policy Snapshot

We collect and store information about you. Let us explain why we do this.

What information do you collect?

We collect a range of data about you, including your contact details, legal issues and data on how you use our website.

How do you collect information?

We collect information over the phone, by email and through our website.

What do you do with this information?

We store and use your information to deliver you better legal services. This mostly involves communicating with you, marketing to you and occasionally sharing your information with our partners.

How do I contact you?

You can always see what data you’ve stored with us.

Questions, comments or complaints? Reach out on 1300 544 755 or email us at info@legalvision.com.au

View Privacy Policy