Franchise Vs Marriage

Posted by on Friday, November 7th, 2014
in Franchise Law

According to Statistics Canada, the average Canadian marriage lasts about 14 years, better than the Australian average of about 8 years, but not much longer than the average Franchise agreement which usually run for 10 years, with an option to extend for another 10 years. That’s a long time to be in a relationship and, if the state of many divorces is any information, it is hard to stay happy together for that long.

Like all of life’s decisions, the time to think about the details of an agreement is before you commit. In business, as in life, we suffer the greatest disappointments when something unexpected arises and undermines our plans. If you are looking to buy a new or existing franchise, talk to us first.
A detailed review or your agreement will more clearly set out some of the nuances of the franchise agreement. If certain obligations are made clear from the beginning then you can add those into your plan and they won’t appear as a sudden surprise.

Common examples of problems arise over; intricate requirements to source products from your franchisor even when local suppliers are available; understanding what types of advertising may not be acceptable to a franchisor; how much participation is required in ad campaigns offering products at discounts; and of course, defining the protected area for you franchise.
Franchise agreements, like people, are unique. Each system has their own local idiosyncrasies, but generally franchisors try to use the same agreement among all the franchisees. However, that does not mean we are not able to negotiate some aspects of the agreement in your favour because of unique local conditions.

Long term relationships that work well provide a stable base in your life but enter the relationship with your eyes open. Before you marry someone, find out which way they hang the toilet paper roll and decide how important this is to you in light of all the benefits of your relationship together. Before you enter a franchise, make sure you know how much flexibility and control you have over operations and how you will work through problems when they arise.

At Vangenne & Company we have experience with many varied franchise systems and agreements from both the franchisee and franchisor points of view. So whether your business is ready to grow by setting up a franchise network or you want to start your career as a franchisee, we are ready to assist you develop a plan and create a franchise that will stand the test of time.

By Robert T. Vangenne