Franchise proposal helps franchisee to take informed decision
Franchise proposal is an important document issued with a purpose to provide prospective franchisees information about franchisor, franchise system and agreement terms so that they can take an informed decision.
The franchise proposal should be complete and should provide basic information including:
The franchisor its promoters, predecessors and affiliates.
Experience professional information about the company, its officers, directors and executives.
Initial and all other fees should clearly explain range and factors that determines the fees. This section should cover initial and all recurring fees and other payments that must be made.
Initial Investment Information of initial investment including all expenditure required to establish the franchise.
Restrictions that franchisor may impose for source of products or services and getting into similar business with other brands
Franchisor and Franchisee’s obligation – List all that is expected from respective parties.
Franchisors Assistance support in advertising, marketing, training and computer systems etc.
Territory Should clearly define exclusive / non-exclusive geographical territories proposed.
Trade Marks / patent / Copyrights / Proprietary information that will be provided by franchisor including service marks and trade names etc.
Renewal, termination and dispute resolution should clearly mention rights and restrictions and exit clause.
Financials performance representations indicative financial performance based on historic and other locations for reference purpose only.