Lintott Law
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Are you ready to invest in a franchise?

Franchising is like getting a jumpstart into entrepreneurship. Food, fitness, pets and countless other retail and service industries offer franchise opportunities for those who wish to be business owners but want the support and name recognition of an already established company. Thousands of companies are franchised in Alberta and across Canada, and there are many options that go beyond the fast food model.

If you are thinking about starting or expanding your own business by buying into a franchise, you should know that you will experience both advantages and disadvantages. It may be helpful to obtain solid financial and legal advice from skilled professionals before you sink your money into this type of venture.

Go in with your eyes open

To be a franchisee, you must first purchase a license from the owner of the franchise. This license will provide you with a business that already has a plan in place, a marketing strategy and a support system for success. You may have access to supplies at a lower cost, and you can benefit from a business name and model many people already trust. Your franchisor should offer support services, provide you with newly researched products or services, and train your staff to meet the standards of the brand.

It may sound like an easy way to start a business, but you should also be aware of the following drawbacks:

  • Not every franchisor may offer the kind of support you need if problems arise.
  • You may find that licenses for very successful franchises are quite expensive.
  • You may have to pay for advertising and other routine expenses.
  • The franchisor has the authority to decide where you will locate your business.
  • You will have little flexibility since you are bound to maintain uniformity with the franchise brand.
  • The terms of franchise contracts typically benefit the franchisor.

The contract is just one of many legal documents you will deal with after receiving approval for a franchise license. These documents must disclose key information about the policies and stability of the business so that you can make an informed decision before you invest your money. Nevertheless, you may find the documents are heavy with legalese. You would be wise to seek advice and guidance from a legal professional who is familiar with Alberta's franchising laws and can help you navigate the process of becoming a franchisee.

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Lintott Law
2913 Centre St N.W.
Calgary, AB T2E 2V9

Phone: 403-879-1613
Phone: 403-520-2288
Fax: 403-230-3477
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