Wednesday, February 17, 2016

Franchise Agreement Questionnaire - Reference:


How much is the initial franchise fee? _____________ 

Refundable ___ Nonrefundable _____ 

What does the initial fee purchase? _________________________________ 

Is a lump-sum payment required? Yes ___ No ___ 

Are installment payments allowed? Yes ___ No ___ How many? ___________ 

Payment due dates ________________________________________________ 

Is franchisor financing available? Yes ___ No ___ Interest rate _____________ 

Are periodic royalty payments required? Yes ___ No ___ 

How often? _____________________________________________________ 

How are they calculated? _________________________________________ 

Does the franchisor provide accounting services? Yes ___ No ___ 

For an additional fee? Yes ___ No ___ How much? _________ 

How are advertising costs divided between the franchisor and franchisee? ____________________________________ 

Is advertising national, regional, or local? _______________________________ 

What other services does the franchisor provide? ________________________ 

How is the franchise premises obtained? Purchase ___ Lease ___ 

Is financing available from the franchisor for the purchase of the premises? 

Yes ___ No ___ 

Interest rate _________ 

How much of a down payment is required? _____________ 

How much are the rent payments? _____________ Due on _______________ 


What geographic area is encompassed by the franchise? ______________________________________________ 

How far away is the nearest existing franchisee of the same franchisor? ______________________________________________ 

Are other franchises planned for the same geographic area in the future? 

Yes ___ No ___ 

If so, provide details _____________________________________ 

Who selects the site for the franchise? Franchisor ___ Franchisee ___ 

Can the franchisee use his or her own property for the franchise? Yes ___ 
No ___ 

If the franchise premises require new construction, who determines the plans and specifications for the building? Franchisor ___ Franchisee ___ 

Who supervises construction and works with the contractor and subcontractors? Franchisor ___ Franchisee ___ 

What are the specifications for and restrictions on the appearance and configuration of the premises? ______________________________________ 

Who provides property insurance on the premises? Franchisor ___ Franchisee ___________________________________________ 

What are the franchisee's responsibilities relating to remodeling? _________________________________________________ 

What restrictions does the franchisor place on remodeling? ________________________________________________ 


Must all equipment and supplies be purchased from the franchisor? Yes ___ 
No ___ 

If not, must purchases be approved by the franchisor? Yes ___ No ___ 

How much control does the franchisor maintain over day-to-day operations? ________________________________________________ 

What aspects of the business are left to the discretion of the franchisee? __________________________________________ 

Are hours and days of operation dictated by the franchisor? Yes ___ No ___ 

Are products and services strictly controlled by the franchisor? Yes ___ No ___ 

Must the franchisee remain personally involved in running the franchise, or can the management duties be delegated? _______________________________ 


Does the franchisor provide initial training? Yes ___ No ___ 

Does the franchisor provide on-going training? Yes ___ No ___ 

Under what conditions may the franchisor terminate the franchise? __________ 

What are the franchisor's duties and obligations to the franchisee in the event of such termination? __________________________________________________ 

Under what conditions must the franchise be renewed? ____________________ 

What happens to the franchisee's interest if he or she dies? ________________ 

Is the franchise assignable? Yes ___ No ___ 

How long has the franchisor been in business? ___ years 

How many total franchises are there? ________ 

Are these franchises financially successful? Yes ___ No ___ 

How long did it take them to become profitable? _______________ 

Has the franchisor complied with all applicable state and federal laws and regulations?  Yes ___ No ___ 

Other questions to ask my attorney: __________________________________