Understanding Franchising Law
Selling a company’s goods or services with the proper legal authorization, known as franchising, is an important and successful form of business. However, as in any business deal, it is vital to protect oneself by becoming well informed. Sound, upfront franchise business advice and counsel is critical to a franchisee’s long-term success.
I am United States and international franchise lawyer Mario L. Herman. With more than 33 years of experience, I represent prospective franchisees in existing franchise relationships, current franchise owners and former franchise owners with regard to both domestic and international franchising law.
Whether to discuss the different forms of franchising or the potential pitfalls of your undertaking, contact me, Mario Herman, for thorough, knowledgeable representation.
What Types of Franchising Exist?
There are primarily two forms of franchising: product/trade name franchising and business format franchising. The simplest form of franchising is product/trade name franchising. In this relationship, the franchisor owns the right to the name or trademark and sells that right to a franchisee. Examples of product/trade name franchises include petroleum distributors and soft drink bottlers such as Coke and Pepsi.
In business format franchising, a broader, ongoing relationship exists between the franchisee and franchisor. In essence, the franchisee is purchasing the franchisor’s expertise, experience and method of doing business. Business format franchisors provide a full range of services, including:
- Site selection
- Product supply
- Marketing plans
- Assistance in obtaining financing
Key elements of a business format franchise include a marketing strategy and plan, operating manuals and a uniform business concept. The franchisee pays an upfront franchisee fee and ongoing royalty fees, which enable the franchisor to provide training, research and development, and ongoing support to its franchisees.
Some common examples of business format franchising include:
- Fast food restaurants such as McDonald’s and Burger King
- Convenience stores
- Fitness centers
- Real estate agencies
Contact Mario L. Herman — U.S. Franchise Business Advising Attorney
Contact me, Mario Herman, to discuss your franchising venture. As an experienced franchisee attorney, I can help you with every aspect of your franchise.