Author(s):
Gillian S.G. Scott, Julia Farr
Dec 2, 2020
Franchise disclosure and contracting is detail-oriented and onerous work, yet vital — even small mistakes can lead to significant and costly repercussions. Here are some simple ways to improve this process.
Use a site-specific FDD
Provide site-specific franchise disclosure documents (FDDs) to franchisees.
Keep your FDD up to date
Review your FDD in full at each use, not just those sections that typically require updating. Updating piecemeal can increase your risk.
Disclose in all provinces
While only some provinces require disclosure, mitigate your risk by voluntarily disclosing in all provinces.
Track key dates
Automate tracking and reminders for key dates including agreement expiry, renewal and any applicable cooling off periods between disclosure and closing.
Streamline document generation
Look for ways to optimize your document generation with automation, such as leveraging mail merge or contract automation software.
Double check your franchisor's certificate!
Your franchisor’s certificate must include signatures from authorized signatories before the FDD is distributed.
Leverage e-signature technology
Manage signatures with e-signature technology to save time and benefit from features like signature block detection, built-in reminders, and audit trail certificates.
Create an information and document management strategy
Centralize all franchisee information, key agreement terms and copies of final documents electronically in organized folders, including proof of delivery of the FDD.
Send FDDs and agreements separately
Send the disclosure document and agreements in separate packages to eliminate the risk of franchisees executing franchise agreements during a regulated waiting period.
Document your process
Process map your current disclosure and contracting practices with your team to identify inefficiencies, clarify roles and responsibilities, and create an action plan to improve the process.
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