Common Mistakes to Avoid as a Franchisee


As franchise lawyers in Mississauga and the Greater Toronto Area, we often encounter clients once they run into troubles with their franchise and have lost a great deal of money from what was supposed to be a good investment. After reviewing each unique case, it’s usually determined that a lot of the issues that end up costing a franchisee almost every dollar of their investment, could’ve been avoided if a qualified franchise attorney had been involved from the beginning, before the franchise agreement was entered into.

If you’re a prospective franchisee, here are the common mistakes to avoid:


  • Not hiring a franchise lawyer

If you’re willing to to pay thousands of dollars to invest in a franchise opportunity, why not put a fraction of that cost towards seeking legal guidance to protect your investment and your life’s work.


  • Assuming you can’t negotiate terms with the franchisor

As much as you may want this franchise opportunity, don’t let your eagerness get in the way of making sure it’s done right. Most franchisors will be willing to negotiate with you if they really want you as a franchisee.


  • Agreeing to vague terms made by the franchisor or sales people

A franchisor or it’s sales people may tell you, “we provide great marketing support” or “we’ll provide a special flavour to make your franchise special”. You’ll want to specifically clarify these terms in your franchise agreement such as, “how much in dollar value is the franchisors contribution towards marketing?” or are they providing signage as a form of marketing? If so, how often? Who’s responsible for the ongoing marketing cost? Is this special flavour protected by a patent?


  • Agreeing to surrender your legal rights

Believe it or not, we’ve seen franchise agreements that actually include in fine print that by signing the document, the franchisee is waiving or restricting their legal right should a dispute arise in the future. You do not want this to happen.

A franchise lawyer can review and interpret a disclosure document and franchise agreement that is proposed to you, to ensure that your best interest is apparent in the agreement.  Securing a knowledgeable and experienced franchise lawyer is the best way to protect yourself and your franchise investment.

Contact a qualified franchise lawyer in Mississauga at Law Works and get the help you need today!

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