Transformation: “rebranding” and the transformation of an existing company into a franchise unit of another company. Some franchisors prefer new business transformations to reduce costs and ensure that the franchise owner has the appropriate skills to manage the business. Duration Legislator may prescribe the duration of a deductible. The powers of local authorities or political subdivisions of the state depend on the status that confers the power to grant subsidies and any constitutional restrictions. Prior to 1979, few government legislators had passed laws to protect potential franchisees from the deception of dishonest franchisors. These laws, known as franchise disclosure laws, require that anyone who offers franchises for sale in the state must disclose essential facts – such as the actual costs of operating a franchise, recurring expenses, and motivated reports on earned profits – that would be essential in deciding to purchase a franchise. The franchise agreement should also contain a section explaining what an offence is and the consequences of the offence. It should also indicate the measures taken to remedy a breach of contract or what happens if the contract is terminated. Franchised: the name given to a person or entity of a company owning a franchise business.
UFOC: A Uniforme Franchise Offering Circular (UFOC) is the original name of what is now called FDD (Franchise Disclosure Document). A privilege granted or sold, z.B for the use of a name or the sale of products or services. Under its simplest terms, a franchise is a license of the owner of a trademark or a business name that allows another to sell a product or service under that name or brand. More generally, a franchise has become a complex agreement under which the franchisee undertakes to manage a business or sell a product or service according to the methods and procedures prescribed by the franchisor, and the franchisor undertakes to support the franchisee through advertising, advertising and other consulting services. “You can only use things that are expressly given to you the rights to use,” Goldman said. “If your franchise agreement says you can only do three things listed in the agreement, it means you can`t do a fourth thing that`s not mentioned.” A franchise agreement is the rule document for how a franchisee will operate its franchise. This franchise agreement is important to the success of both the franchisor and the franchise, and the creation of the agreement should be carried out with care. It should be very important for the franchisor to ensure that the franchise agreement is drafted in a clear and legal manner in order to enforce all the requirements necessary to operate the franchise. Master franchise: a franchise agreement in which the franchisor agrees to allow a franchisee to sell franchised units in a given geographic area. A franchisee master may, but does not necessarily own one or more franchises in his assigned territory.
Not all franchise contracts are set in stone, but depending on the franchise, there may be room to negotiate certain points. Older, more established franchises are less flexible, while newer franchises may be more accommodating in some respects. Initial investment: the estimated total investment a franchisee needs to start the franchise business. Usually presented as a series showing a low-end and high-end sector, the initial investment is in point 7 of a franchisor`s franchise publishing document. Costs include franchising costs, equipment, leases and/or other start-up costs.