FRANCHISING

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Franchising allows one business to operate under the name of another business’ established brand and sell a prescribed product or service.

Franchising can seem like an easy way of starting or expanding your business, but it’s not something you should rush into without the proper knowledge. Whether you are buying a franchise or franchising your own business, it requires a significant investment of your time and money.

• Buying a new franchise
  Buying a franchise gives you the right to run a business and sell a prescribed product or service. Before you buy a franchise, you should consider the same issues as when purchasing any other business in addition to the specific issues of franchising.

  Consider whether this is the right opportunity for you and if you have the right skills and knowledge to run this type of business. Remember this is a significant financial investment, so as a franchisee, you should carefully consider your options.

  It’s important to understand that when you buy a franchise and sign the agreement, you are agreeing to run the business according to the requirements established in the contract. You are also bound by the Franchising Code of Conduct. Consider consulting a business adviser, accountant or solicitor for advice.

  • Complying with the Franchising Code of Conduct
    All franchise businesses are required by law to comply with the Franchising Code of Conduct.
  • Entering into a franchise agreement
    The franchise agreement is a legally binding document spelling out the rights and responsibilities of both the franchisor and franchisee.
  • Understanding your tax obligations
    As a franchisee you need to know how your franchise payments and fees are treated for tax purposes.
  • Resolving franchising disputes
    If a dispute occurs between you (the franchisee) and the franchisor and it cannot be resolved, the Office of the Mediation Adviser (OMA) may be able to assist you.
  • Buying a franchise in your state or territory
    Information on buying a franchise in your state or territory.
• Franchising your own business
  Once you establish a successful business, you could consider expanding your operations by franchising. Franchising is a way of selling the right to run a style of business and sell a product or service for a period of time.

  Before you decide to franchise your business, you should ensure you have a successful and proven franchise model. Operating your own franchise model prior to selling a franchise can help prove your concept, establish demand and create sound processes and systems that can be repeated in each new franchise.

  There is no specific franchise registration or approval process, but setting up is a legal process and can take some time. It is important that you plan thoroughly and seek professional advice from an accountant, solicitor or franchise consultant.

  • Complying with the Franchising Code of Conduct
    As a franchisor, you are required by law to comply with the Franchising Code of Conduct.
  • Preparing your franchise agreement & manual
    A franchise agreement is a legal contract that outlines the rights and obligations of both the franchisor and the franchisee and the relationship between them.
  • Understanding your tax obligations
    As a franchisor, you need to understand your tax obligations and how franchising fees are treated for tax purposes.
  • Resolving franchising disputes
    If a dispute occurs and it cannot be resolved between you (the franchisor) and a franchisee, the Office of the Mediation Adviser (OMA) can help you resolve it without going to court.
  • Expanding your franchise overseas
    Franchising overseas will involve extensive research of your preferred country, especially details on their registration and legislative requirements for setting up a franchise.