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Franchising is a business relationship between you, the franchisee and owner of the business the franchisor. Buying a franchise involves paying the owner of the business for the right to market and sell their stock and or services for a specified period.

There are two main types of Franchises:

  1. a product and trade name franchise where the franchisee is:
    • licensed to sell products manufactured by the franchisor;
    • licensed to manufacture and sell the franchisorĀ“s products ; or
  1. a business format franchise in which the whole business is licensed and standardised, including such elements as business planning, management system, quality of goods, location and appearance.

Entering any small business can carry with it a degree of risk and every situation will be different. It is therefore important prior to purchasing a franchise that you consider the following factors: 

  • The public image of the franchise;
  • The demand for its stock;
  • The associated fess and outgoing costs;
  • The duration of the franchise; and
  • The operational procedures.

Buying a franchise is a serious decision, if successful it could secure your future financially, if not, you could suffer significant financial loss.

At Briese Lawyers, we can assist in providing legal advice regarding Franchise Agreements, including negotiations on the terms of the Agreement, Disclosure requirements and associated lease advice for the premises out of which the business will be conducted. 

Liability limited by a scheme approved under professional standards legislation

This fact sheet is provided as a general guide only and should not be used or relied upon by any person without obtaining legal advice in relation to their own circumstances.


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