5 things you
need to know
about
Franchising Your Business
- Franchising is governed by the Franchising Code of Conduct, which means your documentation must be set up by a lawyer with detailed knowledge of franchising in Australia. Your franchise documents must comply with the Code, and you must comply with the Code as you onboard your franchisees. Working with experienced franchising lawyers will ensure your business is based on a firm legal foundation.
- Franchising touches on various other areas of law, beyond just the Franchising Code. A prudent franchisor needs to be across best practices under employment laws, consumer laws, copyright laws, corporate law, leasing laws, as well as other areas. If you are planning on franchising, you should make sure you understand your obligations under all these
- 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. By recruiting well and developing your first franchisees into brand ambassadors, you may have more success expanding your franchise network.
- The three key documents when franchising your business are the Franchise Agreement, Disclosure Document and Key Facts Sheet. Your lawyer can draft these with your input. You will also need to work with a lawyer to draft other ancillary documents, depending on the structure of your franchise and the obligations you require of your franchisees. We also recommend you work with a franchise consultant to create a detailed operations manual for the franchise, which sets out the specific details of how the franchise will operate daily, such as how you will make and provide products to your consumers.
- Franchising is a complex area of the law, and an experienced franchising lawyer will provide valuable advice on what the Code requires and insight into market practice for comparable franchise systems in the real world.
