The purpose of the franchise agreement is to protect the franchise system and the brand. The key component to franchising is uniformity, and the franchise agreement provides the franchisor with the ability to enforce its policies and procedures. However, franchisees often complain that their franchise agreement is too one-sided and over bearing. Such an agreement can create animosity between the franchisor and its franchisees and deter many potential franchisees from purchasing a franchise. Therefore, a well-drafted franchise agreement balances the franchisor’s goals of uniformity with the franchisee’s desire for autonomy. Strict controls should be placed over matters that are essential to the franchisor, but the franchisor should not control every aspect of the franchisee’s business. In addition to the friction it causes with the franchisees, doing so would open the franchisor to possible vicarious liability claims.

Some recommended language to add to your franchise agreement to help with this balance would be the following: “Any required standards exist to protect our interest in the System and the Trademarks and not for the purpose of establishing any control or duty to take control over those matters that are reserved to you.”

Franchisors should also explain to the potential franchisee that strict control over essential matters to the system also protects the franchisee. A franchisee should want the franchisor to protect the brand. Uniform brand recognition is the name of the game in franchising, and a franchise agreement that prohibits franchisees from affecting the uniformity of the brand, protects they system and each franchisee’s investment.