Fiona Boswell

Senior Associate, Head of Franchising and Commercial Services

Franchising


Top 5 Tips for taking a Master Licence of an Incoming Brand

Fiona Boswell

Becoming the UK Master for incoming brands is the natural next step for the multi-unit franchisee experienced in the sector. There are however a number of issues to consider if this is the route that you want to take.

1. Verify the credibility of the brand

Successful Franchisors in other jurisdictions must be sure that their concepts work in the UK. For example, is the brand registered as a trademark in the UK and does it have a common sense meaning in this country. Are you going to have to register the brand - if so do you know the scope and specification?

2. Ensure you have the right systems and support

What will the Franchisor provide in terms of support for establishing the brand in the UK? How much training will you need - where? Usually this may involve overseas travel - at whose expense?

3. How realistic is the Development Plan

How many stores must you open and in what timescale? How realistic is this? How easy is it to find suitable sites?

4. Get advice on the contract

Franchisors will often require the master to sign up to the contracts they use for all their territories which may be totally unsuitable for the UK. To ensure that you are not agreeing to overly onerous obligations get advice.

5. Draw up your own contract for use with your franchisees

The master franchise agreement will often be unsuitable for this country containing unlawful or unethical provisions that put off franchisees from taking on the brand. Get advice from a specialist franchise solicitor accredited with the Bfa on the preparation of suitable contracts.

Word to the wise

Don't treat this as just another franchise contract - Master Licence contracts are longer term, considerable expense contracts that you cannot get out of early easily. Understanding what you are agreeing to is even more key and as brands as keen to enter a new market you may have more leverage to negotiate changes than usual.

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