The Internicola Law Firm, P.C.

The 4 Stages of a Franchisor/Franchisee Relationship

In the relationship between a franchisor and franchisee there are 4 stages:  

• Introduction;
• Growth;
• Maturity; and
• Decline or development.

Introduction

Every franchisor/franchisee relationship begins with a potential franchisee approaching the franchisor seeking a meeting or some other communication. The franchisor and franchisee then get to know one another with the hopes of developing a mutually beneficial and profitable relationship.

Growth

This stage begins with the signing of the franchise agreement and the grand opening of the new franchise unit. The franchisor will work fairly closely with the franchisee during this time of grand opening and training, helping with advertising, promotion and other appropriate start-up activities.

Maturity

At this point, the franchisor and franchisee know what to expect from one another and the franchisor can allow the franchisee to act almost entirely independently. If all went well in the growth stage, a mutual trust and understanding should exist between the two parties.

Decline or Development

The decline or development stage begins when the franchise business takes a turn for the worse. At this point the franchisee will either seek termination and relief from contractual obligations or realize the problem and find remedies and solutions.

How can a New York business lawyer help me?

If you are an entrepreneur who is interested in franchising a business, there is a lot you need to know. For a limited time, get this FREE business manual - The Revised Franchise Formula: A Guide to Franchising your Business in the New Economy. Offering expert help in New York, New Jersey and nationwide, business and franchise attorney Charles N. Internicola is ready to answer your questions about franchise, national and international trademarks, and any critical business matters that may arise. Contact us today - 1-800-976-4904.