{"id":2047,"date":"2022-01-20T03:00:03","date_gmt":"2022-01-20T03:00:03","guid":{"rendered":"https:\/\/uk.legalvision.com.au\/?p=2047"},"modified":"2023-08-18T03:54:51","modified_gmt":"2023-08-18T02:54:51","slug":"how-to-set-up-a-franchise-in-england-and-wales","status":"publish","type":"post","link":"https:\/\/legalvision.co.uk\/franchising\/how-to-set-up-a-franchise-in-england-and-wales\/","title":{"rendered":"How to Set Up a Franchise"},"content":{"rendered":"\n<p>As a business owner, you may consider becoming a franchisee. A franchise business model can be highly beneficial for your business. For instance, joining a successful franchise can give you access to more customers and information about a working business model. This article will outline what it means to become a franchisee, when it might be good for your business, and how to set up a franchise in the UK<span data-preserver-spaces=\"true\">.<\/span><\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Is Becoming a Franchisee a Good Idea?<\/h2>\n\n\n\n<p>Joining a franchise by becoming a franchisee can be a good idea in several situations. First, being a franchisee will mean that you have access to your franchisor\u2019s:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>business model;<\/li>\n\n\n\n<li>intellectual property; and<\/li>\n\n\n\n<li>knowledge.<\/li>\n<\/ul>\n\n\n\n<p>Intellectual property is usually in the form of a trademark, copyright, or patent. Having access to a franchisor\u2019s intellectual property will allow you to use their brand. This means that you can avoid the costly investment of setting up your own brand.<\/p>\n\n\n\n<p>However, if you <a href=\"https:\/\/legalvision.co.uk\/franchising\/signing-franchise-agreement-what-should-i-know\/\">enter into a franchise agreement<\/a>, you will have to pay royalties and <a href=\"https:\/\/legalvision.co.uk\/franchising\/franchise-fees\/\">an initial franchise fee<\/a> to the franchisor. Therefore, if you consider using a franchise model for your business, you must ensure the benefits outweigh the costs. Entering into a poor franchise relationship can seriously hurt your business. Thus, you must guarantee that your franchise fees are not hurting your cash flow.&nbsp;<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">How Do I Become a Franchisee?<\/h2>\n\n\n\n<p>You should consider some key points if you are seriously considering opening a business as a franchisee.<br>&nbsp;<\/p>\n\n\n\n<h3 class=\"wp-block-heading\">Self-Evaluate&nbsp;<\/h3>\n\n\n\n<p>The first step is to ensure that you are ready to open a business as a franchisee. Most importantly, you must be comfortable with the fact that your business\u2019 brand and image depends on the franchise network on the whole, rather than your performance within your individual business.&nbsp;<\/p>\n\n\n\n<div  class=\"box box--icon box--warning\">\n    <p>You may also have to give security for a loan to raise the capital to pay the franchise business\u2019s initial fee. As your personal assets can be at risk, you want to make sure you do all of your research on the franchise business before making any commitments.<\/p>\n<\/div>\n\n\n\n<h3 class=\"wp-block-heading\">Do Your Due Diligence<\/h3>\n\n\n\n<p>Once you are sure you want to enter into a franchise agreement, you should do your thorough <a href=\"https:\/\/legalvision.co.uk\/business-sale-purchase\/due-diligence-business-sale-england-wales\/\">due diligence<\/a> on the franchise. Due diligence refers to the detailed research process conducted as part of a business agreement.&nbsp;<\/p>\n\n\n\n<p>This will include looking at financial documents such as financial statements and the franchise business\u2019 assets and liabilities. In addition, before agreeing to join a franchise network, you may have access to a franchise disclosure document from the franchisor. This will outline key features of the franchise business as well as some of the operational areas that you can expect to be your obligations as a franchisee. These features include, items like, franchise fees, the structure of your royalty fees, and the finances of the franchisor\u2019s business.<\/p>\n\n\n\n<div  class=\"box box--icon box--info\">\n    <p>One tip is to contact other businesses that have entered into a franchise agreement with the franchisor. The franchise relationship is essential to the success of the franchise on the whole \u2013 as a result, understanding other franchisees\u2019 experiences can be a good way of understanding whether it is a good business opportunity for you.<\/p>\n<\/div>\n\n\n\n<h3 class=\"wp-block-heading\">Sign the Agreement<\/h3>\n\n\n\n<p>The final step of becoming a franchisee is to sign the franchise agreement. This may be accompanied by the <a href=\"https:\/\/legalvision.co.uk\/franchising\/how-should-i-use-franchise-disclosure-document\/\">franchise disclosure document<\/a>, which you should review thoroughly again to ensure it is consistent with any earlier disclosure reviewed as part of your research.\u00a0<\/p>\n\n\n\n<div  class=\"box box--icon box--idea\">\n    <p>As a prospective franchisee, hiring a franchise consultant can be a good idea when reviewing the disclosure document. A consultant can advise you on any legal requirement that you may have undertaken, insight into the franchise opportunity, and whether the franchise model suits your business.<\/p>\n<\/div>\n\n\n\n<p>Before signing, you may also be able to negotiate the terms of the franchise agreement with the franchisor. For example, the franchise owner could be willing to negotiate royalty fees, among other things. However, if the franchise owner is too willing to negotiate franchise fees, that could be a red flag. For instance, it could signify that the franchise business is not a quality business model. As franchises rely on their proven business model, this could be problematic for you as a future franchisee of that model. It would be best to seek professional legal advice to protect your position at this stage.\u00a0<\/p>\n\n\n    <div class=\"my-7 lg:my-10 border-y-2 border-gray-100 py-7 lg:py-10 flex flex-col sm:flex-row items-start gap-10\">\n                    <img decoding=\"async\" class=\"w-52 mx-auto my-0! rounded\" src=\"https:\/\/img.legalvision.com.au\/wp-content\/uploads\/sites\/4\/2023\/03\/07054906\/wordpress-buying-a-franchise-560x792-1.jpg\" alt=\"Front page of publication\"\n                 loading=\"lazy\" width=\"208\" height=\"298\">\n                <section>\n            <div class=\"text-2xl font-bold\">Buying a Franchise in the UK: A Legal Guide<\/div>\n            <div class=\"body-text\">\n                <p>Buying a franchise in the UK? Download this free legal guide to make informed decisions and avoid pitfalls.<\/p>\n            <\/div>\n            \n\n<a href=\"https:\/\/go.legalvision.co.uk\/buying-franchise-guide.html\" class=\" block px-5 py-3.5 max-w-fit bg-orange button__hover transition rounded text-white font-bold text-lg no-underline uppercase leading-tight text-center\" target=\"\" rel=\"\">Download Now<\/a>        <\/section>\n    <\/div>\n\n\n\n\n\n<a href=\"#content-next\"\n   class=\"block p-4 mt-10 text-xl font-bold text-center text-white no-underline bg-gray-800 rounded-t-xl\">\n    Continue reading this article below the form\n    <i class=\"text-xl fa-regular fa-arrow-down\"><\/i>\n<\/a>\n<div class=\"px-6 pt-10 pb-12 mb-10 text-center bg-gray-100 rounded-b-xl sm:px-12 test\">\n    <div class=\"mb-8 text-2xl font-bold text-orange\">\n        Need legal advice?\n        <br>\n        <span class=\"text-lg not-prose\">\n                            Call <a href=\"tel:+448081968584\" class=\"not-prose\">0808 196 8584<\/a> for urgent assistance.\n                <br>\n                Otherwise, complete this form, and we will contact you within one business day.\n                    <\/span>\n    <\/div>\n\n    \n\n<div class=\"not-prose flex justify-center text-left gform_input_bg_white    \">\n    <script>\nvar gform;gform||(document.addEventListener(\"gform_main_scripts_loaded\",function(){gform.scriptsLoaded=!0}),document.addEventListener(\"gform\/theme\/scripts_loaded\",function(){gform.themeScriptsLoaded=!0}),window.addEventListener(\"DOMContentLoaded\",function(){gform.domLoaded=!0}),gform={domLoaded:!1,scriptsLoaded:!1,themeScriptsLoaded:!1,isFormEditor:()=>\"function\"==typeof InitializeEditor,callIfLoaded:function(o){return!(!gform.domLoaded||!gform.scriptsLoaded||!gform.themeScriptsLoaded&&!gform.isFormEditor()||(gform.isFormEditor()&&console.warn(\"The use of gform.initializeOnLoaded() is deprecated in the form editor context and will be removed in 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As a prospective franchisee, you must be familiar with why the franchisor\u2019s business is a good product that suits you. Ultimately, the benefits from the franchise agreement must outweigh the cost of being a franchised business.&nbsp;As a result, if you want to set up a franchise business as a franchisee, you must carry out thorough due diligence before signing any agreement. This could include reading the franchise disclosure document carefully with an expert. <\/p>\n\n\n\n<p>If you need help with setting up a franchise, our <a href=\"https:\/\/legalvision.co.uk\/franchise-lawyers-lp\/\">experienced franchise lawyers<\/a> can assist as part of our LegalVision membership. For a low monthly fee, you will have unlimited access to lawyers to answer your questions and draft and review your documents. Call us today on <a href=\"tel:+448081968584\" class=\"AVANSERnumber dynamic-number\">0808 196 8584<\/a> or visit our <a href=\"https:\/\/legalvision.co.uk\/membership\">membership page<\/a>.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Frequently Asked Questions<\/h2>\n\n\n\n<div class=\"schema-faq wp-block-yoast-faq-block\"><div class=\"schema-faq-section\" id=\"faq-question-1642646167071\"><strong class=\"schema-faq-question\">What is the franchise disclosure document?<\/strong> <p class=\"schema-faq-answer\">The franchise disclosure document is a document that the franchisor may give you alongside the franchise agreement. It will include several key features of the franchise agreement and the franchisor\u2019s business, such as financial statements and your royalty fee obligations.<\/p> <\/div> <div class=\"schema-faq-section\" id=\"faq-question-1642646175642\"><strong class=\"schema-faq-question\">What is due diligence?<\/strong> <p class=\"schema-faq-answer\">Due diligence is the process of research that happens in a business negotiation. You must carry out the due diligence process carefully, as it will inform whether the franchise opportunity matches what you are looking for.\u00a0<\/p> <\/div> <\/div>\n<div class=\"not-prose m-feedback-prompt\">\n    <!-- Thumbs up\/down bar -->\n    <div class=\"m-feedback-prompt__main\">\n        <div class=\"m-feedback-prompt__title\">Was this article helpful?<\/div>\n        <div>\n            <!--span class=\"m-feedback-prompt__button--text\">Thanks!<\/span-->\n            <button type=\"button\" class=\"m-feedback-prompt__button m-feedback-prompt__button--yes\"\n                    data-analytics-link=\"feedback-prompt:yes\" aria-label=\"Agree\">\n                <i class=\"fa-regular fa-thumbs-up fa-3x\"><\/i>\n            <\/button>\n            <button type=\"button\" class=\"m-feedback-prompt__button m-feedback-prompt__button--no\"\n                    data-analytics-link=\"feedback-prompt:no\" aria-label=\"Disagree\">\n                <i class=\"fa-regular fa-thumbs-down fa-3x\"><\/i>\n            <\/button>\n        <\/div>\n    <\/div>\n\n    <!-- Feedback form -->\n    <div class=\"m-feedback-prompt__form\">\n        <div class=\"m-feedback-prompt__form--thanks \">\n            <div>Thanks!<\/div>\n            <p>\n                We appreciate your feedback \u2013 your submission has been successfully received.            <\/p>\n        <\/div>\n        <form id=\"contact-form\" class=\"m-feedback-prompt__form--form\" action=\"\" method=\"post\">\n            <input type=\"hidden\" id=\"authenticity_token\" name=\"authenticity_token\" value=\"9eb4f72322\" \/><input type=\"hidden\" name=\"_wp_http_referer\" value=\"\/api\/wp\/v2\/posts\/2047\" \/>            <input value=\"https:\/\/legalvision.co.uk\/franchising\/how-to-set-up-a-franchise-in-england-and-wales\/\" type=\"hidden\" name=\"currenturl\"\n                   id=\"currenturl\">\n            <input value=\"How to Set Up a Franchise\" type=\"hidden\" name=\"currenttitle\"\n                   id=\"currenttitle\">\n            <label>\n                <!-- display on thumbs-up -->\n                <span class=\"m-feedback-prompt__feedback m-feedback-prompt__feedback--yes\">\n                    Can you tell us <span class=\"font-semibold\">why<\/span> you found it helpful?\n                <\/span>\n\n                <!-- display on thumbs-down -->\n                <span class=\"m-feedback-prompt__feedback m-feedback-prompt__feedback--no text-lg\">\n                    How can we better improve this article?\n                <\/span>\n                <textarea name=\"feedbackmessage\" id=\"feedbackmessage\" required><\/textarea>\n            <\/label>\n\n            <div class=\"m-feedback-prompt__form--error\" id=\"form-submit-error\"><\/div>\n            <button id=\"submit-contact-form-button\" type=\"submit\" name=\"commit\" class=\"m-feedback-prompt__form--submit\"\n                    data-analytics-link=\"feedback-prompt:submit\">\n                Submit            <\/button>\n        <\/form>\n    <\/div>\n<\/div>\n","protected":false},"excerpt":{"rendered":"<p>As a business owner, you may consider becoming a franchisee. A franchise business model can be highly beneficial for your business. For instance, joining a successful franchise can give you access to more customers and information about a working business model. This article will outline what it means to become a franchisee, when it might<a href=\"https:\/\/legalvision.co.uk\/franchising\/how-to-set-up-a-franchise-in-england-and-wales\/\">Continue reading <span class=\"sr-only\">&#8220;How to Set Up a Franchise&#8221;<\/span><\/a><\/p>\n","protected":false},"author":11449,"featured_media":537,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_relevanssi_hide_post":"","_relevanssi_hide_content":"","_relevanssi_pin_for_all":"","_relevanssi_pin_keywords":"","_relevanssi_unpin_keywords":"","_relevanssi_related_keywords":"","_relevanssi_related_include_ids":"","_relevanssi_related_exclude_ids":"","_relevanssi_related_no_append":"","_relevanssi_related_not_related":"","_relevanssi_related_posts":"1454,498,3685,2909,1097,879","_relevanssi_noindex_reason":"","editor_notices":[],"footnotes":""},"categories":[33],"tags":[323,324,455,456],"class_list":["post-2047","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-franchising","tag-franchise-disclosure-document","tag-franchise-agreement","tag-becoming-a-franchisee","tag-franchise-model"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.1.1 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>How to Set Up a Franchise in England and Wales | LegalVision UK<\/title>\n<meta name=\"description\" content=\"Are you thinking of becoming a franchisee? This article explains how to set up a franchise in England and Wales.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/legalvision.co.uk\/franchising\/how-to-set-up-a-franchise-in-england-and-wales\/\" \/>\n<meta property=\"og:locale\" content=\"en_GB\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"How to Set Up a Franchise in England and Wales | LegalVision UK\" \/>\n<meta property=\"og:description\" content=\"Are you thinking of becoming a franchisee? 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