What is a Franchise Agreement Term?
The “term” of your franchise agreement relates to the fixed period of time during which you will possess the right to own and operate your franchised business. Once the “term” of your franchise agreement expires, you will be required to either terminate the operations of your franchised business or negotiate the renewal of your franchise rights. Although the “term” of a franchise opportunity will vary between franchisors and franchise opportunities, franchisors typically grant franchise rights for a period of ten (10) years. The term / duration of your franchise agreement should correspond to the “term” / duration of your lease agreement and should be for a period of time sufficient for you to recoup your investment in the franchise and generate and earn a sufficient rate of return on your investment.
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