Becoming a franchisee? Review your franchise contract

A franchise contract is a very important document. Signing it signifies a long-term commitment between the franchisor and the franchisee. It not only outlines how the collaboration will proceed but also has a significant impact after the partnership ends. It often includes a non-compete or non-solicitation clause, describes how goodwill is divided upon sale, and determines ownership of customer (data). Moreover, the franchise contract is often filled with legal jargon, making it often unclear for a non-lawyer to fully understand its implications. This is why you should only sign it if it is well-constructed!

Want to become a franchisee? Conduct a contract check first!

If you want to become a franchisee, signing the contract is an important life decision. For at least the duration, and often longer, you will be almost daily involved with your franchise business. A franchise contract is a formal document that cannot be unilaterally altered mid-term. You are not entering an employment agreement with many legal protections that you can quit with few consequences, you are becoming an independent entrepreneur. This is even more reason to ensure it is balanced.

There are many questions we analyze as part of a contract check. For example:

• Are the rights and obligations clearly laid out?
• Are the rights and obligations between the franchisor and franchisee balanced?
• Can you still practice your profession effectively after the franchise partnership ends, or are you overly restricted by the non-compete and/or non-solicitation clause?
• Are your interests as well protected as those of the franchisor?
• Does the franchise contract comply with the dutch Franchise Act?

What can you expect from a contract check?

• Your contract will be treated with the utmost confidentiality.
• After assignment and receiving the contract, you will receive feedback within a week.
• You will receive a detailed list of points for adjustment or negotiation.
• We will personally explain the key points and answer all your questions over the phone or via a conference call.
• The cost for the check is €695, excluding VAT for a standard Dutch franchise contract.

We provide you with a quick decision so that entering the franchise partnership doesn't have to be delayed. If desired, we can also offer support in making adjustments to the contract or during negotiations between the franchisor and you as a franchisee. It is crucial that if you are going to become a franchisee, you can make a choice based on the right information.