Franchisee Basics: The Franchisor

Beginning a new franchise can be extremely challenging, making the professional advice of a franchise lawyer invaluable.

Contact Neufeld Legal PC for franchising legal matters at 403-400-4092 / 905-616-8864 or Chris@NeufeldLegal.com

A franchisor is the business entity that grants rights to a franchisee to conduct business under its the brand name and/or trademarks in a manner that it has prescribed and controls. The franchisor has conceptualized and launched the particular business, and has subsequently taken to replicating through the franchising business model, so as to franchise / license their intellectual property, such as trademarks and trade names, and their business know-how to other interested parties that seek to replicate this business model through the franchise system. In exchange for a series of fees, the franchisor allows those approved interested parties (franchisees) to buy into and operate a franchised business under their established brand.

Key attributes associated with a franchisor:

• Brand Ownership: They own the brand name, trademarks, logos, and any other intellectual property associated with the business.

• Business Model: They have developed a proven, replicable system for running the business, including everything from the products and services offered to the marketing techniques and operational procedures.

• Licensing: They grant the franchisee a license to use their brand and business model for a specified period and within a defined territory.

• Support and Training: A good franchisor provides the franchisee with initial and ongoing support. This includes training on how to operate the business, assistance with site selection, access to suppliers, and guidance on marketing and advertising.

• Quality Control: To protect the brand's reputation and ensure consistency across all locations, the franchisor has the right to exercise a degree of control over the franchisee's operations. This is often outlined in a detailed franchise agreement and operations manual.

• Revenue: Franchisors typically make money through a combination of initial franchise fees (a one-time payment for the right to open the franchise) and ongoing royalty fees (a percentage of the franchisee's sales).

Christopher Neufeld is a business lawyer knowledgeable in the rigors and challenges of the franchise business, together with the legal constructs that are critical to their effective operation. For experienced legal representation in starting, acquiring / selling, operating and managing a franchise, contact franchisee lawyer Christopher Neufeld at 403-400-4092 [Alberta], 905-616-8864 [Ontario] or Chris@NeufeldLegal.com.

The Basics to Becoming a Franchisee: Embarking on the path of becoming a successful franchisee demands an incredible amount of time and effort, given that there are only a limited number of truly successful franchisees, with those that have set themselves apart and hit the pinnacle of franchise operations and profitability. This begins with understanding the core concepts of a business franchise. Read more.

 

Contact us via email at chris@neufeldlegal.com or call 403-400-4092 / 905-616-8864.