The intricacies of Franchise Law can quickly become confusing at first glance, and one of the most commonly asked questions is the difference between a franchise lawyer and a franchise developer.
While both franchise developers and franchise lawyers take part in creating a franchise brand, their roles are quite different. The major difference between both is that one has the license to practice law and the power to legally acknowledge the compliance of the franchise disclosure document with federal and state law. Knowing the legalities surrounding franchises requires in-depth knowledge of the state laws. If you’re deciding between a franchise lawyer or a franchise developer, you could speak to a Franchise.Law attorney clued up in the matter.
Franchise Lawyer Vs Franchise Developer
A franchise lawyer prepares the legal documents to franchise a business and sell franchises. They can help you navigate the legal waters and build your franchise in a way that adheres to all norms and regulations. Conversely, a franchise developer assists in operational tasks such as planning a franchise sale strategy, developing an operations manual, and budgeting. They look into the functional business aspects of a franchise.
Franchise developers need the authority or qualification to prepare legal documents such as franchise disclosure documents and agreements. Therefore, in many cases, franchise developers are also referred to as franchise consultants. They are essential in getting a franchise off the ground and ensuring that everything aligns with the business goals and objectives.
Which is Better
Franchise lawyers have the backing of the law and the knowledge and experience in franchising. Having worked with several franchisees and franchisors, they know how to ensure the franchise agreements and disclosure documents are well written. They also know to ensure these documents comply with the Federal Commission’s franchise rules and state-specific regulations where necessary.
While franchise consultants may have many years of experience, they are not licensed to practice franchise law in any state. Thus, they cannot write franchise agreements or disclosure documents without the risk of legal liability for practicing law unauthorized.
For this reason, most franchise developers work closely with franchise lawyers. Nevertheless, franchise developers ensure that the lawyer exclusively performs all the legal work. Basically, both parties work in tandem towards a shared goal. While their objectives are different, their goals are to get the franchise up and running in accordance with local laws and regulations.
Are Franchise Developers Worth Hiring?
Franchise developers must improve their ability to practice law to benefit from a franchise consultant when franchising a business. On the contrary, an experienced franchise developer can be very efficient in several important parts of the business, including operations manuals. The only thing is that they cannot draft the franchise disclosure document and franchise agreement; it is the attorney’s responsibility.
Nevertheless, one must be extra careful and do thorough research before choosing a franchise consultant. You typically do not need licenses or special requirements to call yourself a franchise developer or consultant. That means the degree of competence, experience, and professionalism in franchising varies greatly—and dramatically.
For example, you may encounter franchise consultants who only want to sell you on franchising. Therefore, they do not want to give you an honest assessment of what you need to make it as a franchisor. However, there are also fantastic franchise developers who can render the right help you need in the right way.
Conclusion
When it comes to business franchising, you need someone or multiple people with the right experience, knowledge, and license to assist. Franchise developers can be invaluable if you research them before hiring one. However, their hands are tied because they do not have the backing of the law and, therefore, cannot practice it.
On the other hand, franchise lawyers are licensed and authorized to carry out all the legal activities involved in franchising. Lawyers and developers often work closely together to help coach franchisors through franchise development, creation, and sales.
Also Read: Starting a Recruitment Franchise: Tips, Benefits, and How to Succeed
