Franchising
Franchising is a relatively new phenomenon in Australia compared with the United States of America. However, the number of franchises over the past 5 years has increased so significantly that Australia is now the most franchised nation per head of population in the world. Total sales generated from franchised business equate to approximately 12% of Australia's GDP. Approximately 36% of all franchised business are located in New South Wales and the Australian Capital Territory.
Since 1998, franchising in Australia has been subject to mandatory Franchising Code of Conduct. This code of conduct attempts to provide a level playing field for franchisors and franchisees and, to some extent, it has succeeded.
Although there are many positive benefits to entering into a franchise, there are also a number of concerns for both franchisors and franchisees. Because franchisors are bound by the code of conduct, a franchise must be structured correctly from the beginning. Although not essential, a potential franchisors/ees should get independant advice prior to purchase not only from a lawyer, but from an accountant, financial planner, marketer and other associated experts.
Likewise, it is a good idea for both franchisors and franchisees to conduct their own market research survey of the potential market place, well before they enter into any franchise arrangement.
Much of the success of a franchise relationship depends upon both parties acting in the best interests of the franchise as a whole. Both sides of the relationship need to be promoted, rather than looking at it in an isolated way.
The relationship between franchisor and franchisee is one where there are mutual benefits to both parties in entering into and continuing a sound business partnership. David Prior has acted for both franchisors and franchisees and is familiar with all aspects of practice, procedure, and the law relating to franchising. As a result, he is excellently placed to understand the issues from both perspectives.
In addition, David is a member of the Franchising Council of Australia. This allows Central Coast Business Lawyers to provide the most up to date information, and additional benefits to our clients.