Franchising and Licensing: Two Powerful Ways to Grow Your Business in Any Economy

Franchising and Licensing: Two Powerful Ways to Grow Your Business in Any Economy

Franchising and Licensing: Two Powerful Ways to Grow Your Business in Any Economy

Franchising and Licensing: Two Powerful Ways to Grow Your Business in Any Economy


"For well over a decade, Franchising & Licensing has been the standard reference for industry executives, consultants, and academics. Covering every aspect of these complex but highly profitable business strategies, the new third edition is applicable to domestic and international franchising initiatives alike. Every chapter has been brought up to the minute, with timely and detailed information on subjects such as:

- creating market-responsive sales, marketing, and globalization strategies

- raising capital, structuring agreements, and protecting intellectual property

- meeting regulatory, legal, and employment standards

- establishing quality control and compliance measures

- assessing opportunities for mergers & acquisitions, joint ventures, and other alternatives to franchising

Filled with illuminating examples, stories from the field, and dozens of forms for drafting franchising agreements and licensing programs, Franchising & Licensing remains the definitive resource for corporations in a myriad of industries."


Many owners and executives of growing and established companies fear that the decision to franchise will result in the loss of quality control over the operations and management of their business, resulting in a dilution of their brand and damage to their goodwill. In reality, there are a variety of vehicles available to the franchisor for maintaining the level of quality that they and their consumers have come to expect. A well-planned franchising or licensing program will include a wide variety of system standards, training methods, operational manuals, and internal policies and procedures to establish quality control guidelines, as well as a carefully assembled field support staff to educate franchisees and enforce the franchisor's quality control guidelines.

To succeed, a franchise system demands quality control. A system that does not maintain and enforce an effective quality control strategy is not likely to survive in the competitive marketplace. The licensor of a trademark has an obligation under federal trademark laws to control the quality of the products and services offered in connection with the trademark. Thus, by establishing and enforcing quality control standards, a franchisor not only assures uniformity of quality but also satisfies an obligation imposed by the federal Lanham Act upon the owner of a trademark. Failure to monitor and control the operations of a franchisee/licensee could result in a “statutory abandonment” of the franchisor's rights in the trademark because it may no longer distinguish a particular product or service from those offered by others in the market. Therefore, the trademark laws provide a justification and basis for the implementation of reasonable controls over franchisees/licensees in all aspects of the business format.

Developing and Enforcing System Standards

The glue holding the typical franchise system together consists of the uniform policies, procedures, and specifications that must be followed by all franchisees. These rules and regulations, typically found in the operations . . .

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