This afternoon I received a call from an extremely competent individual who established a successful business‚ had read my book and was looking for information about franchising her business. During our call she had mentioned that she was confused because she was told by the consultant that she "did not need a lawyer" and that the consultant had his "own team of attorneys" – "in-house lawyers" – who would do all the "legal work to prepare the FDD and set up the franchise system". She reviewed the consultants website further and was confused as to whether or not this "consuting firm" was also a "franchise law firm".
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Your FDD is a Legal Document: Franchise Consultants are Not Franchise Lawyers
There are many amazing and experienced franchise consultants – especially consultants that have developed national franchise sales‚ marketing‚ development and advertising programs. However‚ if you are evaluating the services of a franchise consultant‚ it is critical to understand that franchise consulting firms are not franchise law firms and that these "consulting firms" are not qualified nor permitted to provide you with the critical legal advice and representation associated with the development of your FDD and franchise system. Nor are consulting firms permitted to give you legal advice – especially the critical legal advice needed to franchise your business. After our call I took a look at the "consultants" website and‚ I have to admit‚ that it was quite confusing. This particular site referred to the franchise consultant's "team of attorneys" and actually mentions affiliation with a state bar association – but on further review it became clear to me that the consultants were not franchise lawyers and‚ worse‚ that they simply sold a package of services and paid a lawyer to "prepare documents" (basically generic forms) but "not give legal advice".
So my question is as follows: If the franchise consultant is not a lawyer and if the lawyer they "recommend" and "package with their services" does not directly represent you‚ then who is accountable to you? Who will act in your best interest? And Who will advise you of the pitfalls of franchising and how to effectively avoid them?
Be cautious of "franchise consultants" and all professionals for that matter who are content with misrepresenting who they are and what they are qualified to do.
When considering franchising a business it is important to speak with a lawyer before and throughout the process of franchising rather than speaking to one when issues occur after the business has been franchised. Our franchise law firm has developed a program for entrepreneurs who are interested in franchising their business the correct way the first time. For information about our Franchise Compliance Programs contact us at 1.800.976.4904.
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