Understanding Franchise Renewal

Understanding Franchise Renewal

Understanding Franchise Renewal

Part of owning a franchise location requires entering into a franchise agreement. Over time, the franchise agreement for your Florida franchise will need to be renewed. Here is more on understanding franchise renewal.

What is a Franchise?

A franchise is a location of a business that is subject to an agreement between a franchisee and a franchisor. The franchise relationship is created when the two parties agree that the franchisee can use the franchisor’s brand, logo, and likeness when opening a location of the business. The franchisee’s location will be virtually identical to the original business in the way it looks, but a franchising agreement will govern its operation and ownership.

What is a Franchising Agreement?

A franchising agreement is a legally binding contract that is entered into by the franchisee and franchisor. The agreement will include terms that specify the rights and limitations that are being granted to the franchisee and what the franchisor will provide in exchange. The franchisee will pay the franchisor a franchising fee for using the franchisor’s brand. In exchange, the franchisor will allow the use of its image and brand and will usually offer guidance and support to the franchising entity with opening and operating the location.

Who Owns the Franchise Location?

The franchisee will own their own business. However, the franchisor retains the right to direct how its brand, image, logo, and name will be used and how the location will operate. The franchisor may also change how the franchisee will be required to promote and sell its products and services according to the franchising agreement.

What Happens with a Franchise Renewal?

Entering into a Florida franchising agreement involves planning for the present and the future. Therefore, the franchising agreement will typically include terms to govern what will happen now and when the franchise is renewed. For example, the franchising agreement may include terms such as whether the franchisee will be required to pay an additional franchising fee in the future and how it will be calculated. In addition, the franchise renewal language may cover topics such as:

  • What is required for renewal to be granted
  • How long the renewal term will last
  • The timeframe for renewal
  • The amount of the renewal fee
  • Updating equipment, signs, and logo
  • Additional training requirements
  • Renovation
  • Releases

Franchise renewal is an essential part of a Florida franchising agreement. Therefore, you will want to work with an experienced and knowledgeable Florida business law attorney when creating, reviewing, and entering into a franchising agreement. In addition, having experienced counsel while operating your franchise can help you ensure you have the information, guidance, and advocacy you need when business-related legal issues arise.

When working with a Florida small business attorney, you can review the franchise renewal criteria and determine the terms that are needed, support your goals, and are in your best interest.

At the Florida Small Business Legal Center, we understand the complexities of entering into a franchise agreement and the importance of renewal terms. We have the experience you need to review and understand all aspects of the franchising relationship and to protect your interest during every stage of the process.

Contact an Experienced Florida Business Lawyer

Attorney Richard Sierra at the Florida Small Business Legal Center assists clients like you with commercial leasing, business, and litigation matters. As always, Our Goal Is to Help You Succeed™. For an appointment, call us at 1-866-842-5202 or use the contact form on our website. We represent clients throughout the State of Florida, including Coral Springs, Coconut Creek, Boca Raton, Delray Beach, Pompano Beach, Sunrise, Fort Lauderdale, Miami, West Palm Beach, Jupiter, Deerfield Beach, Stuart, Port St. Lucie, Orlando, Naples, Fort Myers, Sarasota, Tampa, and surrounding communities.

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