Franchise agreements


A franchise agreement is a binding legal document that grants the franchisee the right to operate a business associated with the franchiser’s trademark. Franchise agreements intend to protect the intellectual property of the franchisor.

Essential Characteristics

A franchise agreement should consider the following:

  • The responsibility of the franchisee to comply with the business’ operation systems
  • The franchisee’s duty to meet the franchisor’s training and performance standards
  • Reporting requirements
  • Supply arrangements and requirement
  • Responsibilities to staff
  • Responsibilities to personnel in the franchisee’s local area
  • Promotion and marketing practises to be undertaken by the franchisee
  • Performance criteria to be applied to the franchisee
  • Training and support
  • Marketing assistance
  • Renewal clauses
  • Termination clauses
  • Dispute resolution process.