Franchise Agreement Cost

Clients Rate Lawyers on our Platform 4.9/5 Stars
based on 2,801 reviews

Jump to Section

Need help with a Franchise Agreement?

Post Project Now

Post Your Project (It's Free)

Get Bids to Compare

 Hire Your Lawyer

What does a franchise agreement cost? This is a question that a business owner may ask if they are thinking about expanding their company and establishing a franchise. So let’s explore this question and review some general information about franchise agreements.

How Much Does a Franchise Agreement Cost?

A franchise agreement is a legally binding contract between an established franchisor and a franchisee. The entity is granted the right to establish a franchise operation. Essentially, the franchisee purchases the right to run a company under the franchisor’s already established operating system.

The franchise agreement lays out how the franchisee will operate and includes essential information like:

  • The use of trademarks
  • Business systems
  • Operating manuals
  • Products and services offered

Franchise agreements are used to define the rights and obligations of the franchisor and the franchisee and ensure that the franchisee operates up to the franchisor’s standards.

A franchise agreement is an essential legal document if a business owner wishes to license their business as a franchise. Many companies will seek the help and advice of a franchise agreement lawyer to help draft their contract. Therefore, this agreement must be prepared correctly and abide by all applicable franchise laws.

Based on ContractsCounsel’s marketplace data, the average cost of a project involving a franchise agreement is $1,057.

The cost of a franchise agreement will vary depending on several factors. For example, the length and complexity of the document and the geographic location of the business and the lawyer will affect the cost of legal services.

What’s Typically Included in a Franchise Agreement?

Franchise agreements will differ based on the business and the industry. Still, every franchise agreement must include certain elements to make it legally binding and enforceable.

Important clauses that every franchise agreement must have include:

  • The Grant of Franchise Rights and Term. This grants the franchisee the right to establish a franchise location and the license to use the franchisor’s trademark, dress, and business systems.
  • Development Obligations. The franchisee will be obligated to establish a franchise location within a designated period.
  • Training. There will be initial training and ongoing training that the franchisor will provide to teach the franchisee how to run the business.
  • Territorial Rights. Territorial rights are often included in a franchise agreement to protect the franchisee. This will prohibit the franchisor from allowing other franchises to open in the same territory, creating competition.
  • Operating Procedures. The franchisee will be required to follow specific operating procedures laid out by the franchisor. Some operating procedures include what services and products the franchisee can offer, how trademarks are used, and how the business will run the day-to-day operations.
  • Initial Fees. To establish a franchise, the franchisee must pay the franchisor to use the already established business system. The franchise agreement must include the fees and how they are to be paid. Fees can consist of software license fees, initial inventory fees, and purchases.
  • On-Going Fees. In addition to initial fees, franchisees will also have to pay ongoing fees. These will also need to be defined in the franchise agreement. The royalty fee is the most common ongoing fee and is typically paid to the franchisor monthly.
  • Marketing Fees and Obligations. Some franchise agreements require the franchisee to pay any marketing fees to the franchisor. In addition, it is common for franchisees to pay into a “brand development fund” to which all franchisees contribute.
  • Restrictive Covenants. A franchisor must protect the confidentiality of a franchise system so that the franchise will include restrictive covenants like non-compete agreements. This will prevent a franchisee from creating a competing business.
  • Legal Rights and Jurisdiction. Every state has laws that govern franchises and franchise agreements. The state where the franchisor has its corporate headquarters will be the governing law for the agreement.
Meet some lawyers on our platform

Michael K.

58 projects on CC
View Profile

Gregory F.

2 projects on CC
View Profile

Elbert T.

1 project on CC
View Profile

Max M.

105 projects on CC
View Profile

Types of Franchise Agreements

There are several different types of franchise agreements. Suppose you don’t know which agreement to use. In that case, you should consult with an experienced lawyer to help you choose the best agreement for your situation.

The seven most common franchise agreements include:

  1. Master franchise agreements
  2. Product distribution franchise agreements
  3. Job franchise agreements
  4. Conversion franchise agreements
  5. Investment franchise agreements
  6. Business format franchise agreements
  7. Area development agreements

Master franchise agreements are the most commonly used and are typically appropriate for most businesses.

Examples of Franchise Agreement Projects

Franchise Agreement Drafting Service

Franchise agreements are the most important documents for a franchisor because it governs the relationship between the franchisor and the franchisee. This agreement grants the franchisee legal rights and entrusts them with responsibility and obligations. Therefore, this agreement must be professionally drafted by an experienced lawyer. A franchise agreement lawyer will know which agreement best suits your business and what clauses need to be added to protect your company.

Drafting services generally include a consultation, the document's drafting, and a final consultation to go over the contract and determine if any revisions are required.

Franchise Agreement Review Service

The franchise agreement is also the most critical document for a franchisee. This contract dictates how the franchisee can run their franchise, the fees they must pay, and other rules and provisions they must abide by. Therefore, it is common for a franchisee to hire their lawyer to review the contract before signing.

A lawyer can go over the contract to ensure it is fair and protects the franchisee’s rights. They can also explain any terms the franchisee may not understand.

Drafting Franchise Agreement Costs

Drafting a franchise agreement comes with costs because it requires the time of a licensed lawyer to complete the project.

ContractsCounsel’s marketplace data shows the average franchise agreement drafting costs to be $1,083 across all states and industries.

Franchise Agreement Review Costs

Hiring a lawyer to review a partnership agreement will also come with legal fees. The lawyer will read over the agreement to analyze the terms and consult with the client.

ContractsCounsel’s marketplace data shows that the average franchise agreement review costs $1,031 across all states and industries.

How Do Lawyers Charge for Franchise Agreements?

Hourly Rate for Franchise Agreements

Lawyers in all legal fields commonly use hourly rate fee agreements. Using this fee structure, a lawyer will bill a client for the number of hours spent working on a project at a set hourly rate. This fee structure ensures that a lawyer is compensated for all work done for a client.

ContractsCounsel’s marketplace data shows the average hourly rate for a franchise agreement lawyer ranges from $300 - $450 per hour.

Flat Fee Rate for Franchise Agreements

Flat fee billing structures are becoming popular for contract drafting projects like franchise agreements. An attorney quotes a client a flat fee to complete the project when using this fee structure.

The benefit of flat fee billing is that it provides the client with the total cost of legal fees. However, it is important to ensure the client knows what’s included with the fee before starting the project because additional services like consultations and revisions may not be covered.

ContractsCounsel’s marketplace data shows that a partnership agreement's average flat fee rate costs $1,057.

Get Help with a Franchise Agreement

Do you need help with a franchise agreement project? If so, post a project in ContractsCounsel’s marketplace to receive flat fee bids from business lawyers to handle your project. All lawyers on the ContractsCounsel’s platform are vetted by our team to make sure you are provided with top tier service.

How ContractsCounsel Works
Hiring a lawyer on ContractsCounsel is easy, transparent and affordable.
1. Post a Free Project
Complete our 4-step process to provide info on what you need done.
2. Get Bids to Review
Receive flat-fee bids from lawyers in our marketplace to compare.
3. Start Your Project
Securely pay to start working with the lawyer you select.

Meet some of our Lawyers

Yaser M. on ContractsCounsel
View Yaser
Member Since:
July 21, 2021

Yaser M.

Self Employed
Free Consultation
Get Free Proposal
12 Yrs Experience
Licensed in TX
University of London

I have practiced law in foreign jurisdiction for more than 11 years and more than one year in Texas. I am Texas licensed attorney. Practice areas include Corporate: incorporation of business entities, drafting of operating agreements, by-laws, and business contracts; Commercial: business disputes, demand letters, cease and desist lettera, dealing with insurance companies, negotiations, settlements of disputes, commercial real estate, and business litigation Litigation: business disputes, personal injury, civil rights, cross-border matters, maritime matters, drafting of litigation pleadings, motion practice, legal research, white-collar defense.

Joseph L. on ContractsCounsel
View Joseph
Member Since:
July 25, 2021

Joseph L.

Free Consultation
Get Free Proposal
39 Yrs Experience
Licensed in CT
Southwestern University School of Law

Mr. LaRocco's focus is business law, corporate structuring, and contracts. He has a depth of experience working with entrepreneurs and startups, including some small public companies. As a result of his business background, he has not only acted as general counsel to companies, but has also been on the board of directors of several and been a business advisor and strategist. Some clients and projects I have recently done work for include a hospitality consulting company, a web development/marketing agency, a modular home company, an e-commerce consumer goods company, an online ordering app for restaurants, a music file-sharing company, a company that licenses its photos and graphic images, a video editing company, several SaaS companies, a merchant processing/services company, a financial services software company that earned a licensing and marketing contract with Thomson Reuters, and a real estate software company.

Harry S. on ContractsCounsel
View Harry
Member Since:
July 27, 2021

Harry S.

Free Consultation
Get Free Proposal
8 Yrs Experience
Licensed in NY

Stirk Law is a law firm based in London that advises on dispute resolution, commercial and corporate arrangements, employment and private wealth. We are experts in our areas and experienced in advising on complex and high value matters in the UK and internationally. We have extensive onshore and offshore experience across a variety of areas such as the administration of trusts together with complex fraud and trust disputes. Our expertise includes the conduct of significant and high-value cases valued at up to in excess of £1 billion over a combined 40 years of legal practice in England, Jersey and Guernsey. As well as having a large international network, we work closely with a corporate investigations and risk advisory business based in London and Vienna. Together we can deliver a holistic service for cases involving fraud, dissipation of assets or other illegal activity.

Talin H. on ContractsCounsel
View Talin
Member Since:
July 29, 2021

Talin H.

Free Consultation
Get Free Proposal
13 Yrs Experience
Licensed in IL
DePaul College of Law

Talin has over a decade of focused experience in business and international law. She is fiercely dedicated to her clients, thorough, detail-oriented, and gets the job done.

Sam W. on ContractsCounsel
View Sam
Member Since:
July 30, 2021

Sam W.

Entertainment attorney
Free Consultation
Get Free Proposal
Los Angeles
8 Yrs Experience
Licensed in CA
Columbus School of Law, The Catholic University of America

Entertainment attorney and film producer. Counsel clients on all matter of entertainment-related contracts, including talent representation, crew deals, financing agreements, and production legal. Former litigation attorney and owner of a documentary and scripted film and television production company. Well versed in small business foundation and general business contracts.

Craig M. on ContractsCounsel
View Craig
Member Since:
August 2, 2021

Craig M.

Free Consultation
Get Free Proposal
6 Yrs Experience
Licensed in ME
New York Law School

I have been practicing law for more than 4 years at a small firm in York County, Maine. I recently decided to hang my shingle, Dirigo Law LLC. My practice focuses mostly on Real Estate / Corporate transactions, Wills, Trusts, and Probate matters.

Tim M. on ContractsCounsel
View Tim
Member Since:
August 3, 2021

Tim M.

Managing Partner
Free Consultation
Get Free Proposal
Cambridge, MA
24 Yrs Experience
Licensed in MA, NY
Boston College Law School

Tim has 20 years of experience representing a wide variety of emerging and established companies in the technology, software, bitcoin and professional services industries. He works directly with his clients’ executives and boards of directors on corporate, intellectual property, and securities law issues. Recently, Tim has advised clients on Series A and Series B financings, corporate structuring, complex video licensing agreements, and structuring new hedge funds. Tim previously served as Forrester Research, Inc.’s General Counsel and Secretary where he was chief legal officer, led the company’s legal group, and managed the company’s legal and regulatory affairs. Tim played an integral role in the company’s initial public offering in 1997 and coordinated its secondary offering in 2000. He directed the legal process in the company’s acquisitions of Giga Information Group, Inc., Fletcher Research and Forit GmbH and oversaw over $125million in transactions. He also managed the company’s intellectual property assets. Tim is admitted to practice in Massachusetts and New York. Tim holds a Juris Doctor degree from the Boston College Law School and a Bachelor of Arts degree from Trinity College

Melissa G. on ContractsCounsel
View Melissa
Member Since:
August 5, 2021

Melissa G.

Owner/Managing Member
Free Consultation
Get Free Proposal
18 Yrs Experience
Licensed in DC, IL, OH
University of Michigan

Melissa Green recently opened her own law firm which focuses on providing general counsel services, business formation services, and contract services (including negotiation assistance). Prior to opening her own firm, Melissa joined the American Medical Association (AMA) as an Assistant General Counsel in November 2019. In her role at the AMA, Melissa supported the CPT and Masterfile licensing programs, in addition to supporting the legal needs of the Professional Satisfaction and Practice Sustainability business unit. Prior to arriving at the AMA, Melissa was the Chief Legal Counsel and Privacy Officer at The Chartis Group, a healthcare advisory services and analytics company, headquartered in Chicago, where she was responsible for commercial transactions for Chartis and its wholly owned SaaS company, and also served as the organization’s privacy officer responsible for HIPAA compliance. Melissa started her legal career in Cincinnati, Ohio at the law firm of Frost Brown Todd where she served as an associate in the Corporate department doing healthcare transactions, securities, and general corporate work. In 2007, Melissa transitioned into her first in-house counsel role at GE Aviation. During her time at GE, she had many roles including supporting new engine sales transactions for the Europe/Middle East/Africa region, its Electric Power business located in Dayton, its Engine Services business (supporting the CF34 and CF6 engine lines), and compliance. Upon leaving GE, Melissa had a brief stint at MedStar in Virginia before accepting a full-time position at the University of Maryland Medical System in Baltimore, Maryland in July 2013. Originally from East Lansing, Michigan, Melissa received her bachelor’s graduate from Michigan State University’s – James Madison College and is a graduate of the University of Michigan Law School.

Robert Jay H. on ContractsCounsel
View Robert Jay
Member Since:
August 4, 2021

Robert Jay H.

Free Consultation
Get Free Proposal
New York, NY
41 Yrs Experience
Licensed in NY
New York University School of Law

My Legal career hasfocused on representing businesses (corporations and limited liability companies) as general outside counsel. In this capacity, I have drafted a broad range of legal documents as well as analyzed proposed agreements drafted by the other party's attorney to the agreement for the pupose of determining the risks to which my client would be exposed. I maintained the client's minute book if no one in-house was available for that task. Additionally, if rquested, I served as a general advisor to the client's executive offers and to its Board of Directors.

Simon C. on ContractsCounsel
View Simon
Member Since:
August 5, 2021

Simon C.

Corporate Attorney
Free Consultation
Get Free Proposal
18 Yrs Experience
Licensed in UT
Brigham Young University Law School

Corporate counsel with years of in-house experience working with and reporting to board / executive-level and upper management, along with extensive regional / national law firm background in commercial transactions and contracts, complex commercial litigation, and employment matters. Skilled at executing corporate priorities, driving profitability by implementing goal-oriented processes to achieve revenue and productivity targets, and managing company litigation and outside counsel. Recognized for creating policies and practices to address ethical dilemmas and resolving misconduct.

T. Phillip B. on ContractsCounsel
View T. Phillip
Member Since:
August 10, 2021

T. Phillip B.

Free Consultation
Get Free Proposal
26 Yrs Experience
Licensed in IL
Drake University Law School

Attorney creating plans and strategies to help individuals create, build, protect and pass on wealth.

Find the best lawyer for your project

Browse Lawyers Now

Want to speak to someone?

Get in touch below and we will schedule a time to connect!

Request a call