expanding a small business?
Thanks all of you who wrote and gave me some great pointers.
This is a bakery/coffee shop. A family member wants to open the 2nd location with their capital. What kind of contract do we draw up and how do we keep our good relationship within the family while still trying to make both locations successful. I would like to start a franchise if that made sense.
I agree with justwondering…This needs to be carefully drafted in a legal agreement, but a franchise structure is not warranted at this time. Additionally, you should be cautious about involving friends and family as business partners. Even the most iron-clad agreement won’t put your relationship back together if things go sour. You can expect trouble if the business does extremely well (people get greedy) or very poorly (people point fingers).
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Setting up a franchise is an expensive legal process so plan to go big if you do. Had a friend who franchised after he opened his 6th sandwich shop on his own and the name is still going strong after 25 years. Contact a lawyer who specializes in franchises. If you just want to protect yourself with this second location, contact a business attorney. Partnerships are like marriage but with no make up sex after you have disagreements, so you will want to have all angles in writing – including a no compete clause should you split the sheets – so get a lawyer.
References :
I agree with justwondering…This needs to be carefully drafted in a legal agreement, but a franchise structure is not warranted at this time. Additionally, you should be cautious about involving friends and family as business partners. Even the most iron-clad agreement won’t put your relationship back together if things go sour. You can expect trouble if the business does extremely well (people get greedy) or very poorly (people point fingers).
References :
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