What Happens After you Sign a Franchise Agreement with a New Buyer


After signing a franchise agreement with a new franchise buyer, the process of launching and operating the franchise begins. This marks the beginning of a partnership between the franchisor (you, the brand owner) and the franchisee (the buyer), where both parties work together to establish and grow the franchise business. Here’s what typically happens after the franchise agreement is signed:


1. Onboarding and Training: The franchisee will undergo comprehensive training to familiarize themselves with your brand’s operations, products, services, and customer experience standards. This training may take place at your corporate location or through a combination of in-person and virtual sessions.


2. Location Selection and Setup: If the franchise is a brick-and-mortar business, the franchisee will work on selecting a suitable location (if not already selected) and setting up the physical space according to your brand’s specifications. You might provide guidelines, design templates, and support to ensure consistency across franchise locations.


3. Licensing and Permits: The franchisee will work on obtaining the necessary business licenses, permits, and approvals required to operate the franchise in their specific location. This step is essential to ensure legal compliance.


4. Marketing and Launch: As the launch date approaches, both you and the franchisee will collaborate on marketing and promotional strategies to create buzz around the new location’s opening. This could include local advertising, social media campaigns, and any other promotional efforts to attract customers.


5. Support and Ongoing Communication: Throughout the operation of the franchise, you will provide ongoing support and maintain open lines of communication with the franchisee. This support may cover areas such as operations, marketing, training, and troubleshooting.


6. Initial Period and Adjustments: The initial period after opening is crucial for monitoring the franchise’s performance and addressing any challenges that arise. Both you and the franchisee will work together to fine-tune operations and ensure they align with your brand standards.


7. Royalties and Fees: The franchisee will start paying the agreed-upon royalties, ongoing fees, and any other financial obligations as outlined in the franchise agreement. These payments help fund the ongoing support and resources provided by the franchisor.


8. Quality Control and Compliance: You will continue to monitor the franchise location’s performance to ensure it adheres to your brand’s quality standards and operational guidelines. This may involve periodic audits, assessments, and feedback.


9. Continuing Support: As the franchisee continues to operate the business, you’ll offer ongoing support and resources to help them navigate challenges, introduce new offerings, and maintain consistency in customer experience.


10. Growth and Expansion: If the franchisee’s location is successful, both parties may consider expansion opportunities, such as opening additional franchise locations in new areas or regions.


11. Renewals and Extensions: The franchise agreement will have a defined term, and as it approaches expiration, both parties may choose to renew or extend the agreement based on the franchisee’s performance and the relationship between the two parties.


12. Exit Strategy: In the event that the franchisee decides to exit the business or sell the franchise, the terms and procedures for transfer or sale will be outlined in the franchise agreement. This process ensures a smooth transition for the business.


Throughout the franchise relationship, communication, collaboration, and support are key. The success of the franchisee is directly linked to the success of the franchisor, making it essential to maintain a positive and mutually beneficial partnership. By providing ongoing guidance, resources, and assistance, you’ll help the franchisee achieve their goals while also expanding your brand’s reach and reputation.


For more information on how to franchise your business, contact Franchise Marketing Systems (FMS Franchise):  www.FMSFranchise.com 



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