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FDD Item 20: Strategizing Your Questions

We have established the importance of the Franchise Disclosure Document (FDD), which franchisors share with prospective franchisees early in the due diligence process. There are 23 items in the FDD that contain information about the franchisor, the franchise system,...

How Long Do Franchise Agreements Last?

All franchise agreements have different terms. What works well in one system may not be appropriate in another. The term and renewal provisions of the franchise agreement set forth the length of the relationship. There are advantages and drawbacks to an agreement of...

Five Franchising Industry Trends You Should Know Now

Franchising is always evolving. New trends are emerging in the way products and services are offered and what drives growth beyond sales and behind the scenes.  Below are five franchising industry trends franchisors and franchisees should be aware of as they look...

The Laws And Regulations That Protect Franchisees

There are franchise laws and regulations that protect franchisees from being defrauded and unfairly losing their investment. Today we will provide brief overviews of the FTC Franchise Rule, State Disclosure Laws and State Relationship Laws. By understanding how these...

Initial Franchise Fee vs Royalty Fee: What’s The Difference?

Two of the most common costs associated with franchising are initial franchise fees and royalty fees. Franchisees – especially those new to franchising – need to understand the differences between the two and why they are so critical to the launch of a location. ...

How Franchise Consultants Can Aid Franchisees

Franchise consultants provide useful services for franchisors and franchisees. Sometimes referred to as “franchise brokers,” they have insight that can ultimately help both parties and expand the presence of the brand.  For a prospective franchisee seeking to...

What Does It Take To Be A Franchisor?

Two important questions to consider when deciding whether to take the leap into franchising your business: 1. Should you franchise your business? 2. Are you ready to franchise your business? You have a great business. Things are running smoothly, and you are making...

What Is The Effect Of Signing The FDD Receipt

One of the first steps involved in buying or selling a franchise is the sharing of the Franchise Disclosure Document (FDD). Under federal and state law, the franchisor must give the FDD to a prospective franchisee. The FDD is intended to help ensure that franchisees...

Should I Franchise My Tutoring Business Now?

Tutoring is a booming business. In the U.S., it is reportedly a $4.9 billion industry. It is considered to be relatively recession-resistant in that parents are reluctant to cut education services to help their children. While in-person tutoring is likely to continue...

Ongoing Legal Compliance For Your Franchise Explained

Your franchise has launched, and you are actively marketing and selling to franchisees in compliance with all applicable laws. There is no more need for legal advice or so you think. However, under federal and state franchise laws, there are ongoing registration and...

Understanding Franchise Fees and Payments

Before you buy a franchise, it is important to understand what costs will be associated with starting and maintaining it. The franchise disclosure document (FDD) contains information about what fees you must pay to the franchisor and other third-parties. These should...

Beyond The Pandemic?

Discovery Days for franchises were developed as an opportunity for both franchisors and potential franchisees to get to know each other and decide whether they are a good match. Traditionally, they have involved in-person meetings conducted at the franchisor’s...

Quick Facts About Multi-Brand Franchise Development

Experienced franchisees often look to expand their business by becoming area developers, purchasing the right to open multiple locations. However, where those opportunities are exhausted, some developers will begin acquiring franchise rights in other brands, often in...

What Franchisors Should Look For In A Franchise Consultant

Franchisors and franchisees can benefit from the services of franchise consultants. They help develop the franchise system and aid in the sales process by identifying qualified candidates. Franchise consultants have insight that can ultimately help both parties as...

Are Economic Recovery Loans or Grants Right for You?

The federal government created several economic relief programs to assist small businesses with recovery from the impact Covid-19 had on their solvency, stability, and profitability. Though the deadlines vary, several programs originally introduced in 2020 have been...

Do You Have Exclusivity Rights in Your Lease Agreement?

When leasing space in a shopping center, tenants should pay close attention to what exclusivity rights are in the lease agreement if any. Exclusive use clauses prohibit the landlord from leasing space in the shopping center to other parties for uses that compete with...

Are COVID-Friendly Drive-Thru Restaurants the Next Franchise Wave?

Drive-thru restaurants have always been a convenient and popular option for fast food. However, COVID-19 has had a demonstrable impact on the success of this model. According to Franchise Times, many drive-thru chains saw double-digit growth in 2020, including Jack in...

Are You Subject to Franchise Relationship Laws?

Franchise relationship laws regulate franchisor behavior after the purchase of the franchise. Generally, they establish limitations on a franchisor’s rights regarding terminating the franchise, failing to renew the franchise, or failing to approve a franchisee’s...

Is an Area Development Agreement Right for You?

If you think owning several franchises is a good idea, an area development agreement might be right for you. Unlike with single-unit franchises, an area development arrangement enables you to obtain the right to develop multiple locations within a designated...

It’s Time for 2021 Annual Updates to Your FDD

When the fiscal year ends, it is time for franchisors to start the annual process of updating their Franchise Disclosure Document (FDD). Under the Federal Trade Commission (FTC) Rule, franchisors are obligated to update their FDD within 120 days from the end of the...

Webinar: Multi-Unit Franchising Beyond the Pandemic

Despite the pandemic, franchising remains a popular option for many business owners. Franchising enables franchisors to rapidly expand a successful business model, while franchisees can take advantage of an established brand. A recent virtual roundtable hosted by...

What Happens to the Lease When a Franchise Terminates?

Leasing property for a franchise involves two different agreements – the franchise agreement and the commercial lease. The franchise agreement sets forth the franchisor’s rights and requirements with respect to leases signed by the franchisee. The lease terms must...

Top Three Issues in Negotiating Area Development Agreements

Some franchisees want to develop several franchises in a region as a way to increase revenue and profits quickly. Having multiple local businesses can reduce costs, improve efficiency, and provide some temporary protection from competition. Selling multiple franchises...

Are Virtual Discovery Days for Franchises the Future?

Discovery Days for franchises were developed as an opportunity for both franchisors and potential franchisees to get to know each other and decide whether they are a good match. Traditionally, they have involved in-person meetings conducted at the franchisor’s...

Should You Consider a Ghost Kitchen for Your Restaurant?

Ghost kitchens are getting more attention by restaurant owners thanks to COVID. The concept predates the pandemic, but with restaurants struggling to survive, the potential for lower costs and more revenue is particularly attractive. Ghost kitchens are off-site...

Negotiating Master Franchise Agreements

Every sale of a franchise requires a franchise agreement whether it's a single-unit franchise agreement or a multi unit franchise agreement which sets forth the terms that will govern the relationship between the franchisor and franchisee. In the context of a master...

June 2020, Julie Lusthaus featured on The Boston Podcast

On June 22, 2020, Julie Lusthaus was featured on The Boston Podcast. In the episode, titled Getting Back to Business? Julie Lusthaus and insurance professional Mike Laorenza talk about the future of business, sports and much more. Click the link below to listen....

Is This the Time to Franchise Your Tutoring Business?

Tutoring is a booming business. In the U.S., it is reportedly a $4.9 billion industry. It is considered to be relatively recession-resistant in that parents are reluctant to cut education services to help their children. While in-person tutoring is likely to continue...

Is a Master Franchise Model Right for You?

As discussed in a previous post, there are several types of franchise models including Single Unit, Multi-Unit Development (or Area Development), Conversion, and Master Franchise. Each has its advantages and disadvantages based on the franchisor’s expansion goals...

COVID-19 Results In States Extending Franchise Filings

As the coronavirus spreads across the U.S., the federal and many state governments are providing relief to businesses by extending the deadlines on various filings. Among the areas receiving attention are state registration and filing deadlines for franchisors....

Businesses Face New ADA Claims Over Gift Cards

A new wave of litigation under the Americans with Disabilities Act (ADA) is hitting business owners. For the last few years, businesses have faced lawsuits regarding the accessibility of their website to the visually impaired. Now, gift cards are have become a target...

Should You Franchise Your Commercial Cleaning Business?

Commercial cleaning businesses are experiencing solid growth thanks to increases in construction and real estate investments. According to Allied Market Research, the commercial cleaning services market size is expected to grow at 5.8% globally by 2022. The commercial...