How to Pick a Franchise Attorney

When it comes to building and growing a franchise, legal representation is a vital part of the puzzle. Why? At the federal level, the Federal Trade Commission has a Federal Franchise Rule that, in most cases, requires franchise brands to disclose prospective franchisees with a Franchise Disclosure Document (FDD). And even before issuing the FDD, brands need to button up trademarks and other intellectual property. Once a brand starts signing franchisees, the franchise lawyer remains essential, not just for responding to the prospective franchisee’s attorney’s questions, but also to protect the franchise brand for the ultimate exit.

But picking the right franchise attorney can be a challenge. Franchisors need to mae sure they are asking the right questions:

Does the attorney understand franchise law?

While many lawyers will tell you they can handle franchising, there is added value (and less cost) to using an attorney that is focused on franchise law. This way, you won’t be paying fees (often hourly) for the novice lawyer to learn a category. There are no shortage of options for finding the right franchise attorney, and there is no reason to waste time and money on one who is learning the industry with you.

What is the franchise law firm’s key point of differentiation?

Just as your business will have to have a clear point of differentiation, look into the law firm’s, too. What are the value-adds they will bring? How do they win business? What tools and technologies do they have to shorten the path to winning and help you keep the costs down? 

Is the franchise lawyer and their firm a good fit to your business? 

Just as you evaluate prospective franchise buyers for alignment with your brand, operational model and mission, it is crucial to evaluate franchise lawyers by the same standards. Are they someone you see yourself grabbing a beer with? Do they fit your culture? Do you have confidence they will have your back when you battle a legal challenge? Ask these questions to yourself when performing due diligence on the right legal fit.

Does the law firm or the franchise attorney have a proven track record of winning?

If you ask the franchise lawyer to give you an example of a brand whose growth they helped to accelerate, you will have a starting point. Then, ask for a detailed explanation of what exactly they did to support that growth. While they may or may not have a home run brand under their belt, this question will help you understand and believe whether they have the potential to lead you to build one.

What is the cost and how does it fit into your budget?

This could very well be the first question you may ask. Some franchise attorneys, especially if part of a larger firm, could come with an expensive price tag. Sometimes, those price tags include additional resources. Sometimes they don’t. For ballpark numbers, according to Franchiselawsolutions.com, the typical fixed fee for FDD development and franchising a business ranges from $15,000 to $45,000 and franchise lawyers that charge based on hourly billing set their rates at $300–$700.