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Will I be able to see a copy of a franchisor’s operations manual before I invest in a franchise?
The first time that the franchisee usually has contact with an operational manual is on the initial training course after he has signed his franchise agreement and paid any upfront fees. The manual will be loaned to the franchisee to be available as a continuing guide to the conduct of his business.The franchisor’s operational manual will contain in a written form the complete method for conducting the franchise business. It contains the franchisor’s ideas, know-how, trade secrets and day-to-day instructions for the operation of the business. The manual is therefore extremely valuable to the franchisor, who will not want to release this package of information to a franchisee before he signs up. The franchise agreement should include all of the substantive obligations and provide that the franchise system will be conducted in accordance with the operational manual, which will be varied and updated as need be. The manual should not be used to impose substantive obligations on the franchisee. However, if on reviewing a franchise agreement prior to entering into a franchise it refers to terms of conditions of sale or other contracts that will be entered into between the franchisor and the franchisee that are set out in the manual, the franchisee should ask to see these before he enters into the franchise agreement.
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