FRANCHISE LAW
Franchise Law Articles
Plain-English analysis of FDD reviews, franchise agreements, exit strategy, and ongoing counsel for franchisees and franchisors.
477 articles
How to Handle Franchise Resales: Buyer & Seller Guide
A franchise resale is the purchase or sale of an existing franchised unit — the business, its assets, and the right to keep operating under the franchise …
License vs. Franchise: The Legal Difference That Matters
The legal difference between a license and a franchise comes down to a three-part test in the FTC Franchise Rule. A license grants permission to use …
Can a Franchisee Terminate a Franchise Agreement?
Yes — a franchisee can terminate a franchise agreement, but only for cause or by mutual consent, and only by following the process the agreement and applicable …
FDD Item 19: How to Read Financial Performance Data
Item 19 of the Franchise Disclosure Document is the only place a franchisor may legally tell you what its franchises earn — and disclosing it is entirely …
What Is a Franchise Business Review?
A franchise business review is a structured evaluation of a franchise system’s health — its financials, operations, and franchisee satisfaction — done …
FDD Registration States: Where Franchisors Must File First
FDD registration states are the states where a franchisor must file its Franchise Disclosure Document with a state regulator — and in most of them, wait for the …
Franchise Broker vs Consultant: What to Know
The most important thing to understand about franchise brokers and franchise consultants is that, in most cases, they’re the same thing — and …
Franchise Operations Manual: What It Is & Why It Matters
A franchise operations manual is the detailed how-to guide for running a unit of the franchise system — the document that turns the brand’s business model …
Infringement vs Breach in a Franchise Agreement
In a franchise dispute, “infringement” and “breach” describe two different kinds of violation with two different legal bases. Breach is …
Letters of Intent in Franchising: When and How They're Used
A letter of intent (LOI) is a short preliminary document that sets out the main terms of a proposed deal before the parties negotiate the full contract. In …
Master Franchisee vs Area Developer Explained
Master franchisee and area developer are the two main vehicles for multi-unit franchising, and the difference between them is fundamental: an area developer …
Single-Unit vs Multi-Unit Franchise: Key Differences
A single-unit franchise agreement gives you the right to own and operate one location. A multi-unit arrangement commits you to opening several — and that …
What Does Royalty Fee Mean in a Franchise Agreement?
A royalty fee in a franchise agreement is the ongoing payment a franchisee makes to the franchisor — most commonly a percentage of gross sales — in exchange for …
Personal Guarantees in a Franchise Agreement
A personal guarantee in a franchise agreement is your written promise to be personally responsible for the franchise’s obligations if your business …
Negotiating a Franchise Agreement: What You Can Change
You can negotiate a franchise agreement, but only at the margins — franchisors hold the royalty rate and brand standards firm to keep the system uniform, while …
How to Franchise Your Business: Legal Requirements
Franchising your business means licensing your brand, trademarks, and operating system to independent owners who pay to run it your way — and in the United …
5 Legal Cases That Transformed Franchising
Five legal milestones built much of the framework that governs American franchising today: Siegel v. Chicken Delight (9th Cir. 1971), which outlawed a …
7 Things to Know Before Buying a Franchise
The things that surprise franchise buyers most are almost all disclosed in the FDD — they just don’t get read closely enough. Before you sign, know that …
An Improper FDD Renewal: Common Defects and Risks
An FDD renewal can be filed perfectly on time and still be “improper” — because it carries stale, incomplete, or unsubstantiated information. …
Common FDD Renewal Mistakes Franchisors Should Avoid
The most common FDD renewal mistake is treating it as a date-stamp instead of a full update — reissuing last year’s Franchise Disclosure Document with a …
