1851 Franchise

Buying a Franchise Masterclass

 Franchise Opportunities

Get Support Buying a Franchise

How to Buy a Franchise White Paper

How to Buy a Franchise

How to Sell Franchises

How to Grow a Franchise

Find a Franchise Supplier

1851 Franchise Opportunities

Franchisor News

Franchisor Power Rankings

FranCamp Mastermind Summit

Franchise Development Website Builder

Franchise Resources

The Top 10 Low-Cost Franchises With High ROI 

Website Awards

Power Rankings

About 1851

Advertise on 1851

Contact 1851 Editorial

Terms of Use

1851 Login

GROWTH CLUB LOGIN

facebook

instagram

twitter

linkedin

youtube

From Manager to Owner: How This Franchisee Built a Sport Clips Haircuts Business Without Leaving His Full-Time Job

Sport Clips Haircuts On Pace for Significant Unit Expansion By End of 2026

The Comeback Story: Why Sport Clips Haircuts Is Positioned for Net Positive Growth Again

Why Wild Bill's CEO Mike Quilty Built a Franchise That Goes to the Crowd Instead of Waiting for One

Top 10 Reasons to Buy a Tide Services Franchise in 2026

Why This Multi-Unit Paris Baguette Operator Invested in The Coffee Bean & Tea Leaf With New Camarillo Café

Franchise Opportunity Deep Dive: Newk’s Eatery is a fast-casual restaurant brand serving made-from-scratch sandwiches, salads, soups and pizzas rooted in Southern hospitality.

Newk’s Eatery Franchise Costs, Fees, Profit and Data for 2026

newks-eatery-franchise-costs-fees-profit

Franchise Legal Player:&nbsp;<a href="https://www.linkedin.com/in/frank-robinson-2646422b/?originalSubdomain=ca">Frank Robinson</a> Firm:&nbsp;<a href="https://cassels.com/">Cassels Brock &amp; Blackwell LLP</a><a href="https://chambers.com/lawyer/frank-robinson-canada-20:1546303">Frank Robinson</a> has built a reputation as a trusted advisor to franchise brands navigating growth, compliance and long-term risk. With experience advising emerging, scaling and mature franchisors across restaurants, hotels, consumer products, automotive, home care, fitness, home services and other consumer-facing industries, Robinson brings a practical, business-minded approach to franchise law. Their work focuses on helping brands scale responsibly while protecting both the franchisor and franchisee experience.1851 Franchise connected with Robinson to discuss what franchisors often overlook, where legal risk hides during expansion, and the lessons that continue to shape his advisory philosophy.1851 Franchise: What originally drew you to franchise law, and what has kept you engaged in the space over time?Frank Robinson:&nbsp;The practice of franchise law is dynamic, the clients we serve are talented, creative and diverse, and the franchising sector continues to evolve and create new opportunities for all stakeholders. As a franchise lawyer, our clients require advice and support in a broad range of areas, including franchise compliance, intellectual property, M&amp;A, real estate, litigation and so on. This keeps the practice varied, interesting and never dull. Our clients span an immense spectrum of industries, from restaurants and hotels to consumer products, automotive, home care, fitness, home services and more. We benefit from being able to participate in so many different businesses. More recently, increased interest in the franchise model from private equity, public markets and other capital partners has fostered areas of growth and opportunity that pull our clients — and us with them — into new and exciting places. It has never been a better time to be a franchise lawyer.1851: As franchising continues to evolve, what legal issue do you see brands most often underestimating today?Robinson:&nbsp;Whether it has to do with the evolution of franchising, or not, an often-overlooked area — that can create downstream legal risks — is the tolerance of deviations from quality standards, often small to start, that erode the integrity of the system and relationship dynamics over time. Many new franchisors regret or resist having to “police” their franchisees, but a failure to enforce a healthy degree of respect for franchise protocols and contractual compliance can transform pesky nuisances into a widespread undermining of the system. Oversight, communication, mutual respect — and the occasional hard conversation — go a very long way.1851: In your experience, where do emerging franchisors tend to get tripped up from a compliance or documentation standpoint?Robinson: Do it once. Do it right. This is what should guide any emerging and responsible franchisor when considering documentary compliance. As a franchisor, your primary assets are the revenue-generating franchises that follow the model and receive value for their adherence to standards. While much of this is sustained by the quality of the business and relationship, it is rooted in the franchise documents, especially the franchise agreement. Mistakes in the documents are multiplied by the number of franchises in the system and can compound over time. Reversing course once agreements are signed is challenging. Franchise systems should invest in quality documents from the start, and know how to use them.1851: What distinguishes your approach or philosophy when working with franchise clients?Robinson:&nbsp;Never losing sight of the client’s goals, whatever they are, however they evolve. Most clients desire growth and sustainability of the franchise system and the franchisees who make it up. Our philosophy is to fully align with clients on that path. In many ways, we see ourselves as a part of their franchise development teams, facilitating the sale and support of their networks. In all cases, our approach is founded on a deep and intimate knowledge of the business of franchising, understanding the needs and goals of our clients, offering practical, responsive and actionable advice, and sharing in and taking responsibility for the outcomes of our clients, whether celebratory or disappointing.1851: Looking back, what lesson from your legal career has had the greatest impact on how you advise clients today?Robinson:&nbsp;Working in a law firm, most problems are answered with a legal response. But, our clients operate in a dynamic and integrated environment in which the legal implications to any problem are one of a multitude to be considered when choosing a way forward. The effectiveness of a lawyer is increased dramatically when he or she can develop the sense and confidence to understand the place and limitations of the law in the context of a complex business problem — and then offer solutions that work in real time.Every great franchisee had help buying a franchise. Want to learn more about how 1851 helps franchisees find the right franchise opportunity? Visit&nbsp;<a href="http://www.1851growthclub.com/">www.1851growthclub.com</a> and start your journey.

Frank Robinson — Cassels Brock & Blackwell LLP

1851 Franchise’s annual roundup of the Top Franchise Lawyers You Should Know is back for 2026, spotlighting the legal minds helping shape the future of franchising. 

2026 Top Franchise Lawyers You Should Know: Frank Robinson — Cassels Brock & Blackwell LLP

2026-top-franchise-lawyers-frank-robinson

Franchise development has a measurement problem. Brands obsess over lead volume, cost per lead, and funnel conversion rates. Dashboards look clean. Campaigns look optimized. Reports show progress.But behind those metrics is a harder truth: most franchisors are optimizing a system that doesn’t reflect how buyers actually behave.We recently analyzed a dataset of real franchisees, their discovery paths, decision timelines, fears, and what ultimately pushed them to say yes. The findings are not subtle. They challenge some of the most common assumptions in franchise marketing.In a recent episode of <a href="https://www.youtube.com/watch?v=YE1fn5hlaSE">Coffee &amp; Analytics</a>, 1851 Franchise publisher <a href="https://www.linkedin.com/in/powills/">Nick Powills</a> shared 20 lessons every franchisor should internalize if they want to attract better operators and grow sustainably.<h2>1. Discovery Is Often Accidental</h2>Franchisees rarely follow a linear path into a brand. Many discover opportunities through travel, as customers, or through casual exposure. This means your brand is being evaluated long before a prospect ever fills out a form.Takeaway:&nbsp;Your growth strategy should extend beyond lead generation. Discovery is happening whether you design for it or not.<h2>2. The Physical Experience Still Wins</h2>A consistent pattern emerged: prospects visited locations, tried the product, and evaluated the experience in person. That moment often carried more weight than anything digital.Takeaway:&nbsp;Your units are your most important marketing asset. If they don’t convert customers into believers, nothing else will.<h2>3. Brokers Still Matter</h2>Despite the rise of digital channels, brokers remain a meaningful part of the early funnel for many buyers.Takeaway: Ignoring broker relationships is not a strategy. It is a blind spot.<h2>4. Buyers Consider a Small Set of Brands</h2>Most franchisees evaluated between five and ten concepts, not dozens.Takeaway: You are not competing in a broad market. You are competing in a tight, high-stakes consideration set.<h2>5. Websites Validate, They Don’t Convert</h2>Not one franchisee cited a website as the reason they chose a brand.Takeaway: Your site’s role is credibility, not persuasion. If you expect it to close deals, you’re asking it to do the wrong job.<h2>6. Financial Clarity Is the Biggest Gap</h2>Franchisees repeatedly asked for clearer expectations around investment, returns, and what is actually included.Takeaway: The issue is not the absence of data. It is the absence of storytelling around the data. If your Item 19 exists without context, it creates hesitation instead of confidence.<h2>7. Timelines Are Consistently Underestimated</h2>Many buyers entered the process without a clear understanding of how long it would take to open or reach profitability.Takeaway:&nbsp;Overpromising speed or underexplaining process creates friction later. Transparency upfront builds trust.<h2>8. “Support” Is Too Vague</h2>Franchisees expect strong support, but often describe it as unclear or inconsistent.Takeaway:&nbsp;If you cannot define support in concrete terms, your buyers will define it for you, and usually not in your favor.<h2>9. Lifestyle Matters as Much as ROI</h2>Freedom, flexibility, and building something personal in their community were common motivators.Takeaway:&nbsp;Buyers are not spreadsheets. They are people making identity-driven decisions.<h2>10. Fear Is Real and Predictable</h2>Financial risk, wiring capital, and uncertainty surfaced repeatedly.Takeaway:&nbsp;Every deal faces the same three barriers: funds, fads, and fear. The brands that win address all three directly.<h2>11. Validation Drives Confidence</h2>Conversations with existing franchisees were among the most influential parts of the process.Takeaway:&nbsp;Your operators are your most credible sales force. Invest in them accordingly.<h2>12. There Is No Standard Timeline</h2>Some buyers inquired within a week of discovery. Others took nearly a year.Takeaway:&nbsp;A rigid funnel ignores reality. You need systems that capture urgency and nurture patience.<h2>13. High-Intent Buyers Move Fast</h2>When the right buyer meets the right brand, decisions accelerate quickly.Takeaway:&nbsp;Your process should not slow down serious operators.<h2>14. Slow Buyers Need Long-Term Engagement</h2>Many prospects require months of exposure and education.Takeaway:&nbsp;Franchise development is not just acquisition. It is sustained relationship building.<h2>15. Consumer Brand Strength Matters</h2>Many buyers were already customers or fans of the concept.Takeaway:&nbsp;Strong consumer brands create built-in franchise demand. Weak ones rely entirely on marketing.<h2>16. Media Is Not a Primary Research Tool</h2>Buyers relied more on search, lists, and peer input than traditional media coverage.Takeaway:&nbsp;Awareness does not equal influence. Trust is built elsewhere.<h2>17. Buyers Want Honesty, Not Perfection</h2>Franchisees consistently indicated a desire for clearer, more realistic expectations.Takeaway:&nbsp;The brands that stand out are the ones willing to say what is hard, not just what is attractive.<h2>18. Not All Buyers Are the Same</h2>Experienced operators evaluate differently than first-time franchisees.Takeaway:&nbsp;One message cannot serve both audiences. Your strategy must segment accordingly.<h2>19. Decisions Are Personal</h2>Life stage, career transitions, and personal goals often triggered action.Takeaway:&nbsp;The final decision is rarely made on logic alone. It is made when the opportunity aligns with a moment.<h2>20. Marketing Channels Rarely Get Credit</h2>Not a single franchisee pointed to ads or campaigns as the reason they chose a brand.Takeaway:&nbsp;This does not mean marketing is irrelevant. It means its role is misunderstood.<h2>The Bigger Problem</h2>Franchise systems are built to optimize measurable inputs. Leads, clicks, conversions.Buyers operate on something entirely different: experience, trust, validation, and timing.When those two systems are misaligned, performance suffers. Not because the marketing is ineffective, but because it is aimed at the wrong target.<h2>What Needs to Change</h2>Franchisors who want to grow should rethink their approach in four ways:<ul><li>Design discovery, not just capture it</li><li>Turn locations into conversion engines</li><li>Build structured validation into the process</li><li>Communicate financial reality with clarity and confidence &nbsp;</li></ul>Growth is not about increasing activity. It is about aligning strategy with behavior.The brands that win the next decade of franchise development will not be the ones with the most leads. They will be the ones that understand how decisions are actually made and build systems around that truth.Because if your strategy does not match reality, it does not matter how well you execute it.The truth is, all of the above can be overwhelming. In fact, when assessing brands, we deliver a playbook that reaches 100 pages. Franchisors look at it with blank stares and say, “Now what?” Millions of dollars takes millions of hours (or a lot of work). But, over the course of two years, if diligent and organized, a brand can leverage the above learnings to turn up the momentum.Watch the full episode <a href="https://www.youtube.com/watch?v=YE1fn5hlaSE">here</a>.&nbsp;Growing and selling franchises is difficult. Want to learn more about how 1851 helps franchisors grow their franchises with confidence? Visit&nbsp;<a href="http://www.1851growthclub.com">www.1851growthclub.com</a> and see what we can do for you.

image of Coffee and Analytics Live Webinar on franchise marketing

1851 Franchise publisher Nick Powills presents 20 lessons every franchisor should know to attract better operators, pulled from a dataset of real franchisees and what ultimately made them say yes.

20 Lessons on Franchisee Behavior that will Change Your Marketing Strategy

franchise-development-buyer-behavior-strategy

Franchise Legal Player:&nbsp;<a href="https://www.linkedin.com/in/lanefisher/">Lane Fisher</a> Firm:&nbsp;<a href="https://fisherzucker.com/">FisherZucker</a><a href="https://fisherzucker.com/our-practice/our-attorneys/lane-fisher/">Lane Fisher</a> has built a reputation as a trusted advisor to franchise brands navigating growth, compliance and long-term risk. With experience advising early-stage and growth-oriented franchisors across multiple franchise-driven industries including health and beauty, home services, fitness, food and senior care, Fisher brings a practical, business-minded approach to franchise law. His work focuses on helping brands scale responsibly while protecting both the franchisor and franchisee experience.1851 Franchise connected with Fisher to discuss what franchisors often overlook, where legal risk hides during expansion, and the lessons that continue to shape their advisory philosophy.1851 Franchise: What originally drew you to franchise law, and what has kept you engaged over time?Lane Fisher:&nbsp;Franchise law is inherently multidimensional; it sits at the intersection of licensing, trademarks, corporate work, regulatory compliance and dispute resolution. That’s what drew me in initially, but what’s kept me here is the people and the growth curve. Franchising attracts entrepreneurial founders and strong operators, often in family-run businesses, and I enjoy helping them scale in a disciplined way. And because franchising cuts across so many industries — health and beauty, home services, fitness, food and senior care, just to name a small sample — you’re always learning. If your client’s brand grows, your work grows with it, and you can be part of that story from launch through an exit.1851: As franchising evolves, what legal issue do you see brands most often underestimating today?Fisher:&nbsp;If I had to pick only one, I’d say the impact of AI, and the jury’s still out on how the issue develops.Brands are racing to use AI in marketing, franchise development, screening, pricing, scheduling, performance benchmarking, etc. But a lot of franchise documents were written pre-AI and don’t clearly address who owns the data, who can aggregate it and how it can be used or monetized.There’s also a risk layer people miss: AI tools can create real-world expectations. If prospects rely on AI-generated performance projections or comparisons, you can end up with disclosure and misrepresentation issues, including “implied” financial performance claims.1851: Where do emerging franchisors tend to get tripped up from a compliance or documentation standpoint?Fisher:&nbsp;The biggest mistake is treating the FDD like a marketing brochure instead of a regulated disclosure document. Early-stage brands sometimes plug in estimates for initial investment without real calculations and then don’t update those numbers as actual experience comes in. They also underestimate training, especially around what salespeople can and can’t say and how to handle financial performance representations. If you’re offering Item 19, you need clean data, clear assumptions and documentation behind it.1851: How should franchisors think about risk management as they scale into new markets or add new growth strategies?Fisher:&nbsp;Prioritize quality over quantity. The fastest and easiest way to create long-term risk is awarding franchises to undercapitalized or mismatched operators. Strong franchisee selection and validation solve a lot of problems before they start.1851: What distinguishes your approach or philosophy when working with franchise clients?Fisher:&nbsp;I’m not interested in being an “FDD factory.” A franchise system should reflect a real, replicable business, so we’re candid with clients about readiness, and sometimes that means telling someone to wait. We also spend real time understanding the underlying unit economics. If a client is making an Item 19 disclosure, our job is to help them normalize the data, define the assumptions clearly and communicate it in a way that’s accurate and useful.More broadly, we coach clients to grow smart. Initially, that might mean selling smaller deals to better operators, disciplined expansion and, of course, documentation that matches how the business actually runs.1851: Looking back, what lesson has had the greatest impact on how you advise clients today?Fisher:&nbsp;Two things: (1) franchising isn’t for everyone and (2) preventable problems are expensive.The best systems respect the reality of independent business owners and are designed to motivate and support them, not just control them. And when disputes happen, the quality of the documents and the advice you got early on really matters. So we really counsel clients on disciplined growth: resist the temptation to “sell the most” and instead award franchises to better-capitalized, more capable operators. A little restraint upfront saves a lot of pain later.Every great franchisee had help buying a franchise. Want to learn more about how 1851 helps franchisees find the right franchise opportunity? Visit&nbsp;<a href="http://www.1851growthclub.com/">www.1851growthclub.com</a> and start your journey.

2026 Top Franchise Lawyers You Should Know: Lane Fisher — FisherZucker

1851 Franchise’s annual roundup of the Top Franchise Lawyers You Should Know is back for 2026, spotlighting the legal minds helping shape the future of franchising.

2026-top-franchise-lawyer-lane-fisher-fisherzucker

For&nbsp;<a href="https://www.linkedin.com/in/ainsley-hightower-7b230133/">Ainsley Hightower</a>, the path to business ownership was completely unexpected. With a background in journalism and a long career in marketing strategy and fundraising, the mother of three simply wanted an outlet to find herself amidst the chaos of early motherhood. She started out taking fitness classes and eventually became an instructor at the&nbsp;<a href="https://1851franchise.com/extraordinary-brands">NEIGHBORHOOD barre</a> in Memphis. When the original owner offered to sell her the struggling studio, Hightower hesitated at first. Thanks to some soul-searching at a yoga retreat&nbsp; and encouragement from her father, owner of multiple restaurant franchises, she realized it was the opportunity of a lifetime.&nbsp;Despite taking over the business at an incredibly busy time in her life, Hightower leveraged her marketing background and the brand's franchise support to completely turn the studio's finances around, bringing it out of the red and into profitability within just seven months. Now, three years after taking the reins, she has driven 30% year-over-year growth. Building on this incredible turnaround, Hightower recently signed a lease to open her second&nbsp;<a href="https://neighborhoodbarre.com/franchise/">NEIGHBORHOOD barre</a> studio, fulfilling her long-term goal of bringing the fitness brand to her home community of Germantown, Tennessee.1851 Franchise spoke with Hightower about her unexpected journey into business ownership and her plans for the future. Here’s what she had to say:1851 Franchise: Frame your personal story for us. What do you want us to know?Ainsley Hightower:&nbsp;I went to the University of Mississippi for journalism and had a long career in marketing strategy and fundraising. My path to becoming a barre business owner had nothing to do with what I’ve done in my career. About five years ago, a friend who was an instructor at the studio asked if I would be interested in coming in and doing some teaching. I have three little boys, and I had just had my second child, so I thought it would be great to do something that let me find myself a little bit. I auditioned, became an instructor, and eventually left my full-time career to work freelance from home and teach classes. Then, six months after my third son was born, the original owner of the Memphis studio came to me and said she was selling the studio and offered to sell it to me.1851: What did you do before franchising, and how did you decide franchising made sense for you?Hightower:&nbsp;When the owner first offered to sell me the studio, I declined because I had a six-month-old and two other little boys. Around the same time, my yoga studio was running a yoga teacher training I completed, and I felt a pull on my spirit. I realized that I did want to own a fitness studio. Two weeks later, the owner came back and said she still thought I should buy it. My husband, who is a commercial banker, looked at the numbers and was hesitant because the studio was in the red. I talked to my dad, who owns a couple of food franchises, and he told me it's not every day someone basically gives you a business. I knew what it took, and I knew I could do it, so I went back to my husband and said, "We're doing it!" He got on board- he knows when I set my mind to something, I won’t allow myself to fail.1851: What was your perception of franchising prior to becoming a franchisee, and what do you want people to know about franchising now that you are in it?Hightower:&nbsp;I honestly didn’t have much knowledge of franchising. Because I didn't expect to be a business owner, I knew almost embarrassingly little information—I didn't even know that I was going to have to pay royalties. However, I will always tell people that I could not have done it if it weren't a franchise. The support, the guidance, and the built-in team are big reasons my business is successful. The resources taught me so much about running my business, making money, and meeting my goals.1851:&nbsp;What made you pick this brand? What excites you most about this company?Hightower:&nbsp;From a barre lover's perspective, there is no other brand with the variety of formats that our brand has. You don't find that anywhere else. I really appreciate that the brand and leadership are constantly looking to keep that evolution going so that we don't get pigeonholed.&nbsp;It's really exciting that no matter what's trendy or what people are looking for, you can make a client's experience match their needs. I also love that our classes are so accessible. There's a modification and an advancement for every single thing we do, so everyone is making the class their own.1851:&nbsp;What do you hope to achieve with your business? What are your plans for growth?&nbsp;Hightower:&nbsp;We actually just signed the lease for our second studio. People in Memphis kept asking if I was going to open a location in the suburbs where we live. We noticed a space with a "for lease" sign right near our house, and all the pieces fell into place. Opening a second location has been the goal for so long and there’s still so much to do, so that’s still the dream.&nbsp;Beyond that, my main goal is for someone to hear NEIGHBORHOOD barre and know exactly who we are and where we are in my community. I want to build brand recognition around Memphis and for people to associate our studio with an effective, inclusive and all-around fun workout&nbsp;1851:&nbsp;What advice do you have for other people thinking about becoming franchise owners?Hightower:&nbsp;My best advice for other franchisees is not to be afraid to pay for help and delegate. If you have to pay more for help and take home less so your quality of life is better, it's worth it every time and you won’t experience burnout as often.&nbsp;I also tell people that your franchise is only as successful as much as you are present. People have to know your face and associate you with the business. At the same time, remember it's still just a job. I'm a mom and a wife first, so those things are still top priority. You have to find a good balance of showing up and staying on top of everything, without feeling like you have to do it all and control it all.About NEIGHBORHOOD barreFounded in 2011 by Katy Richardson, NEIGHBORHOOD barre delivers a fresh, modern approach to fitness, one that is welcoming, effective, and rooted in community spirit. With studios across the United States, NEIGHBORHOOD barre combines low-impact, high-result training with an inclusive atmosphere that empowers clients of all fitness levels. For more, please visit <a href="www.neighborhoodbarre.com">www.neighborhoodbarre.com</a>.

image of ainsley hightower, franchise owner of neighborhood barre memphis

Starting as an instructor as an outlet outside of motherhood, Ainsley Hightower took a leap of faith to purchase the Memphis studio and is now preparing to open her second location in the suburbs.


‘It’s Not Every Day Someone Gives You a Business’: How This Franchisee Turned an Unexpected Opportunity into a Multi-Unit Success with NEIGHBORHOOD barre

neighborhood-barre-franchisee-ainsley-hightower-germantown

As founders transition into franchisors, few areas carry more risk than earnings claims and advertising. It’s also one of the fastest ways to derail a franchise system before it even gets off the ground.The challenge is clear: prospective franchisees want to&nbsp;<a href="https://1851franchise.com/how-to-start-the-process-of-buying-a-franchise-a-comprehensive-guide-2723007">understand the financial potential of the business</a>, but franchisors must operate within strict legal boundaries about what they can and cannot say.<h2>Understand What You Can Legally Say</h2>In franchising, financial representations are regulated under the&nbsp;<a href="https://1851franchise.com/what-financial-performance-data-can-legally-disclose-a-guide-2731310">FTC Franchise Rule</a>. For example, the only place a franchisor can formally present financial performance data is within Item 19 of the&nbsp;<a href="https://1851franchise.com/how-to-buy-a-franchise-what-is-an-fdd-2724901">Franchise Disclosure Document (FDD).</a>That rule shapes everything.“One of the most important sections of the FDD is Item 19. This is where a franchisor may choose to disclose financial information about existing franchisees,” said&nbsp;<a href="https://www.linkedin.com/in/katy-branstetter-richardson-762684b7/">Katy Richardson</a>, founder of&nbsp;<a href="https://neighborhoodbarre.com/franchise/">NEIGHBORHOOD barre</a>. “Anyone involved in the franchise sales process can only discuss financial performance to the extent it is disclosed within that section of the FDD. For that reason, franchisors must be extremely careful not to make financial representations outside of what is formally disclosed in Item 19.”<h2>The Role of Validation</h2>While franchisors are limited in what they can say, prospective franchisees are not limited in what they can learn.&nbsp;<a href="https://1851franchise.com/how-to-buy-a-franchise-what-is-an-fdd-2724901">Every FDD includes a list of current and former franchisees</a>, and candidates are encouraged to reach out directly to get real-world insight.“Franchisee validation is often one of the most valuable parts of the due diligence process,” Richardson said. “It gives candidates the opportunity to hear firsthand experiences from operators within the system.”Rather than trying to “sell” performance through marketing, strong systems allow their existing franchisees and documented data to tell the story.<h2>The Biggest Legal Mistake: Not Hiring the Right Counsel</h2>If there is one mistake that consistently creates risk for emerging franchisors, it’s failing to work with&nbsp;<a href="https://1851franchise.com/top-franchise-legal-players-2025-franchise-lawyers-2730250">experienced franchise counsel</a>. “Strong franchise counsel is not just drafting documents,” Richardson said. “They are helping franchisors build a compliant, transparent and scalable foundation for long-term growth.”Franchise law is highly specialized, and while the rules may appear straightforward, the application is certainly not.“Inexperienced counsel often misses the nuances and operational realities unique to franchising,” Richardson said. “One common area of confusion is the Advertising Fund, specifically, which expenses can appropriately be allocated to that fund versus corporate overhead or brand operations.”<h2>Common Pitfalls in Earnings Claims</h2>Beyond general compliance, several specific mistakes recur across franchise systems.The first is incomplete or misleading cost disclosures. “Failing to fully disclose the actual costs franchisees incur to open a business” is one of the most common issues Richardson sees.Underestimating startup costs may make an opportunity appear more attractive upfront, but it creates long-term problems when franchisees encounter unexpected expenses.The second is improperly structuring Item 19 data. “There are many ways to structure an Item 19,” Richardson said. “The strategy behind our disclosures varies by brand.”At NEIGHBORHOOD barre, for example, the focus is not just on revenue, but on profitability.&nbsp;“We believe it’s important to highlight the metric that matters most to prospective franchisees: profitability,” Richardson said. “Higher AUVs do not necessarily translate to stronger margins or healthier businesses. With NEIGHBORHOOD barre, we intentionally disclose key studio operating expenses to provide a clearer picture of unit economics and overall profitability.”The third mistake is failing to account for ongoing fees and flexibility. “Failing to account for all ongoing fees, or the franchisor’s right to modify those fees within Item 6” can create confusion and potential disputes down the line, Richardson says.<h2>Advertising Pitfalls: Where Brands Get Tripped Up</h2>Earnings claims are not limited to formal documents. They can also appear, intentionally or unintentionally,&nbsp;<a href="https://1851franchise.com/franchisor-marketing-materials-guide-2730579">in marketing materials</a>, such as website copy, sales brochures, discovery day presentations, social media posts and conversations with candidates.It’s easy to forget that almost any remark about a franchisee’s potential income counts as a legal earnings claim, including casual comments like “our top locations bring in X.”That is why navigating the space where marketing meets legal rules is always a bit of a tightrope walk. The most successful franchisors don’t leave things to chance. They stick to the data, keep every message in sync with their FDD, and lean heavily on expert counsel. Ultimately, they let their numbers and their actual franchisees do the talking.In short, they focus less on selling and more on proving.Want to learn more about how 1851 helps franchisors grow their franchises with confidence? Visit&nbsp;<a href="http://www.1851growthclub.com">www.1851growthclub.com</a> and see what we can do for you. &nbsp;

From Founder to Franchisor Legal Pitfalls

New franchisors face major legal risks when giving prospective franchisees an idea of how much they can make, which is why strict compliance with Item 19 of the FDD is essential.

View Search Filters

BRAND NEWS