A sample franchise contract must be sent to the franchise applicant by franchise law but there is much more you can do with it with a little creative thinking.

A copy of a sample franchise contract is required to be sent to the hopeful franchise owner shortly before D-Day when you and that starry eyed future franchise magnate sit down to sign the formal franchise agreement template document. When you get ready to roll out hundreds or more franchise ownerships, it is easy to have a standard sample franchise contract on the shelf that you ship out just to punch the clock and live up to that quirk of the franchise rules.

There are places you can download a sample franchise contract template that is generic.  It is easy to consider simply sending that to the franchise owner and let it go at that.  Of course, if do that, when the franchise owner sits down to sign the actual franchise agreement form that will turn into a long term franchise relationship with you, he or she may find some surprises.  That is a situation that you should avoid at all costs because surprises when you are ready to seal the deal and collect those fat franchising fees can put big storm clouds over the relationship.

It takes more work but make it a part of your franchising program to send to each franchise applicant a sample franchise contract that is exactly what he or she will sign not that many days later. Much depends on how customized you make your sample franchise agreement for each franchise applicant.  The more you bend over backward to make each franchise relationship unique and a perfect fit for that particular market and franchise owner, the more success and big bucks you can expect from that franchise sale.

The sample franchise contract is a great way to stimulate conversation and relationship with your franchise partners.

There is no getting around that you have to send that sample franchise contract because that is spelled out in franchise law in bold letters. So while you are doing your duty as a good franchise operator and sending along that sample franchise contract, why not get some good from this step along the path to adding a new franchise to your chain?

Along with the legal hoops you jump through to take that raw franchise owner recruit from application to closing the deal, there is an educational path to take each new franchise owner through as well. Even if the franchise applicant is an old pro at buying franchises, if this is the first franchise they have bought from you, they need to learn the ropes. The sample franchise contract is a great step to stimulate questions and to get a dialog going with the franchise applicant.

Along with the sample franchise contract, you can send support material that encourages the new franchise owner to ask questions and arrange meetings to clear up any hazy areas about that document or any other quirks of the franchise relationship. A smart franchise buyer will turn into a much better franchise owner who will deliver the goods when it is time to roll up his sleeves and turn that franchise into a huge money making operation. You can help that new member of your team become that productive by using the sample franchise contract step of the process to build that partnership into something that will stand the test of time.

Your franchising company will provide a sample franchise contract well in advance so you know what you are signing when you enter into that binding relationship.

A sample franchise contract is part of the process of learning every detail about the franchise relationship before you sign those papers and make that partnership take off.  Any good franchising company will flood you with every imaginable document so you will come to the table a fully informed partner.  They know that the more you know about the benefits and the demands of franchising, the more you will make your franchise take off and make a pile of money for them and for you.

The sample franchise contract that you get from the franchising company is just one of the documents that is important for you to know like the back of your hand.  Along with the franchise agreements and the franchise operating manual, you will get more information about the nitty-gritty of running a franchise than you may have ever imagined was out there.

However, you do not have to wait until the franchise company is ready to send you a sample franchise contract as that step usually happens just before franchise agreements are signed and you are officially part of that company’s family of franchise members.  There are plenty of places online where you can find sample franchise contracts and other franchise documents.  The good of using these resources is you can start the process of becoming a serious expert in franchising even before you pick out which company will be the one you want to sell you a franchise.

Look for the danger signs like fixed costs despite profits in the sample franchise contract you get from the franchising company.

It is important to keep in mind that the primary source of franchise information once you begin negotiating that new franchise adventure will be the company that is selling you their franchise. They don’t do this just because they are really sweet people.  They must provide you with every possible kind of disclosure information before the transaction takes place as part of franchise law.  However, once you get that sample franchise contract in your eager hands, consider the source.  Since all of the binding franchise agreements that you will sign originate with the other party, it makes sense they will be written more to protect their interests than yours.

One example of a financial plan that is common in a sample franchise contract is where the fees you pay to the franchising company are fixed.  If the amount you pay to the franchisee is not a percentage of profits, you could end up paying high fees while you are still building the business.  It would also lower the incentives to the franchisee to link arms with you and make you profitable.

This is just one example of why it is smart to have any sample franchise contract that you get reviewed by some legal geniuses that work for you.  By using a lawyer who knows his stuff about franchising, he will know the ropes of modifying that sample franchise document so that your interests are protected too.  It is not out of line for you to negotiate for the best franchise agreements for your interests. Don’t be afraid to have that sample franchise contract looked at and to ask for changes so that you can get a sweet franchising deal that makes you rich and keeps the franchising company smiling too.  That is how it should be.