Franchise Law

St. Louis, Missouri, Franchise Setup Lawyer

At Allan, Grimm, and Summary, we know that purchasing a franchise may be the first step in a dream of one day owning your own successful business. Operating a successful franchise provides the independence and income that can lead to a satisfying career. Making sure that all of your bases are covered before purchasing or expanding a franchise operation will mean that you will increase your opportunity for growing a successful family business. Unfortunately, too many eager franchise buyers don't clearly understand how franchise contracts and agreements are enforced, leading to disputes and lawsuits that can be disastrous to a successful business.

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Business law and commercial litigation attorney John Allan established Allan, Grimm, and Summary in 1974 with the simple philosophy that people will be more successful if they can avoid legal pitfalls. For more than 30 years we have been helping individuals, families, and business entities purchase, operate, and sell successful franchise operations. Contact us to learn more about franchise law. We will provide a no-cost consultation about our services and why an experienced franchise law attorney in vital to your success. Good business sense starts with know the law. Sound business law advice starts at Allan, Grimm, and Summary. From our offices in St. Louis, we serve clients across eastern Missouri, Illinois, and throughout the Midwest.

We provide a complete range of franchise law services:

• Franchise contracts and purchase agreements
• Commercial real estate law
• Franchise litigation, franchisor disputes
• Employment law
• Employment immigration
• Corporate setups, tax structure
• International franchise opportunities
• Intellectual property, licensing agreements

Some things we want you to know about franchise law

Benefits: By law the franchisor (seller) has to supply a purchaser with certain information that a seller of a non-franchised business does not have to supply. This may include: a history of the franchisor and its principles; an estimate of how much it will cost to make the investment, as well as the price of the investment; how many times the franchisor has been sued, by whom and for what, and the name and address of all other franchisees, including those that have left the system. From this information, the average gross earnings of the franchisees can be determined. You can usually own one or more, and you can control territories. It has worked very well for very many people. If others are successful it is a pretty good indication that if you Follow The System, you will be successful, also.

Drawbacks: Once a person buys in, the person is tied for the term of the deal.

You will find that if the trademark is not strong, there is very little benefit to the franchise, and you will resent the royalty payment because you will think you can do it on your own. Franchisors tend not to do very much for the franchisee once the franchise is sold and the franchisor is mainly interested in getting the royalties paid on time.

There is no equity in franchise ownership. The longer you are in the more the value goes down unless the franchisor is strong i.e., has a strong recognizable trademark.

Franchise agreements are one-sided in favor of the franchisee and unless you have good representation from a knowledgeable person going in, it will be too late to change after you sign. Even when you leave the system you will not be able to do a similar business for a while because you will be required to agree to that before you get in.

How to purchase a franchise

Plan: This is an important decision, especially if this is a first-time purchase. Give yourself some time to investigate the thousands of opportunities. Budget some expense money for travel, for attorneys, and for accountants to help in the decision process. Select a business you like to do, or something you might have an interest in and check it out.

Criteria: The more mature the franchise, the more likelihood of success there will be. Franchise ownership is not the way to instant millions. It is a way to experience self employment on a controlled scale. Many franchise opportunities are only profitable if you own two or three outlets. If the franchisor has little or no business experience in franchising, the price should reflect that. If the brand is a strong recognizable mark, that is good. Conversely, if there is no such asset, it is not advisable to pay a lot to buy the use of the marks.

Business Deal: The franchisor is not your buddy. It is in business to make itself money. Just remember that fact. If there are promises made by the franchisor or its agent, and those promises are not in the written franchise agreement, it is as if the promised were never made. Deal fairly but at arms length and you will be well served.

Contact us to discuss your franchise plans. We provide a full range of franchise law services to help you be successful.