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Franchise Law FAQs

(Frequently Asked Questions)
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  1. Why does the franchisor lease the property from the landlord and I sublease from the franchisor?

  2. The franchise agreement seems quite tough. Can I negotiate some of the terms?
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1. Why does the franchisor lease the property from the landlord and I sublease from the franchisor?

By controlling the lease and subleasing the premises to you, the franchisor is really your landlord. If you don't pay rent, franchise fees, or breach any of the agreements, the franchisor can easily take back the premises from you.
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2. The franchise agreement seems quite tough. Can I negotiate some of the terms?

Not usually. Good franchises work well because of consistency, and this requires equal treatment for all franchisees. If basic terms of the franchise agreement are negotiable, that may mean that the franchisor is not very organized, and you should look carefully at it.

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This page last updated: October 15, 1999
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