Making an agreement in franchising a business
Franchising a business is a good option to get rid of your daily boring job. Franchising someone else’s business is a lot safer than starting off your own business. It gives you the experience that the brand has gained over many years, which otherwise you would take a long time to achieve. Also, running such a business gives you the existing marketing plans and strategies that have already been implemented and have succeeded.
So, it sounds a safe option to franchise a business. However, before getting in the franchising business, make sure your agreements with the franchisor are clear and detailed. Mostly, such agreements are formed by experienced lawyers. But if you wish to do it yourself, you can go ahead. A very crucial point which should be considered in an agreement is the payment ratio. Usually, the agreements state an upfront payment to the franchisor which is followed by periodic payment in terms of royalties.
It is important to clarify the reselling aspect of the franchise - if the franchise can be resold or not. The fact can affect your agreement and your willingness to do such a franchising business. It is then an option for you to go for such a franchising package or not. Remember that it’s your business too, at the end of the day. Establishing the above points in your agreement will lay the foundation for business. Make sure where you want the franchisor to have freedom and where do you wish to draw a line.