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Selecting a franchise consultant and a franchise lawyer

Question:  I think I want to franchise my business, but I need some help.  How would I select a franchise consultant and a franchise lawyer? 

Answer:  First, understand that franchising is a business growth strategy and foremost, a business relationship.  Not all franchise agreements and structures are the same, nor should they be, given this proposition.  It is important that you understand your business and your objectives.  Sometimes, franchise consultants or lawyers can focus your thought process.  But I believe that you should begin your research about franchising yourself.  There are wonderful resources out there in this digital world. 

If you want to consider alternative business terms and relationships, consider reviewing the franchise disclosure documents of several concepts that focus their franchise opportunities on selling hamburgers, such as McDonald’s, Burger King, Wendy’s, Five Guys, Smashburger, Hardee’s, Sonic, Checkers, and A&W.  You will discover that each franchisor has its own business terms that are important to it, each has significantly different initial investments, fees, royalties, marketing fees, local advertising spend requirements, territorial rights, supply chain sourcing requirements, rebates from suppliers, etc.  This review will also assist you to focus your thoughts to the important business terms and structure you desire for your concept. 

Second, begin learning about franchising.  We recommend that our franchisors read the book,  Franchising for Dummies.  This book will give you some basic knowledge about franchising as a growth strategy, the business structure that you will have to create, the frame of mind that you must embrace, and the legal requirements needed to sell franchises, among other things.  Your review of this book will also force you to think about your business in the franchise context.  So, before you engage franchise consultants and franchise attorneys, invest some of your own time and begin to learn all you can about franchising on your own.

Nest, there are some wonderful resources available.  One example is the International Franchise Association.  The IFA’s website is full of resources, many of which do not require IFA membership.  The IFA is the preeminent pro-franchising organization in the world, and they make no bones about it.  However, the resources on the IFA’s website (www.franchise.org) is generally reliable, quality, and informative. 

Once you are comfortable that you have a basic understand of franchising, working with knowledgeable business advisors will be easier, because you now begin to speak the language, and you will be able to analytically review the qualifications and demeanor of your advisors.  I believe that the selection of your franchise consultant and franchise lawyer are your most important decisions in your growth.  You may have a working knowledge of franchising from your initial research, but your learning curve on franchising is steep.  Do some research on your prospective consultants and lawyers.  Do they specialize in franchising?  Your consultants need to work in and around the franchise model on a full time basis.  Your lawyers should be IFA Supplier members, and members of the American Bar Association’s Forum on Franchising.  Ask for references.  Check them out.  You are hiring, so be selective.  After you have verified that your consultants and lawyers are qualified, you must ensure that you are very comfortable with your consultants and lawyers because you will be spending a lot of time with them.  Make sure that your personalities mesh.  Do you like their communication style?  Do you like them?  Will you be able to work thorough difficult business issues in a positive and constructive manner.  After you have selected your consultants and lawyers, hold on … franchising your brand will be a wonderful journey!

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At Fahey Schultz Burzych Rhodes PLC, we’ve been helping municipalities, franchised businesses, employers, and more with their legal needs since 2008. We’d love to learn how we can help you, too.