Lawyer Monthly - December 2024

WWW.LAWYER-MONTHLY.COM 27 and disclosure, whereas federal law only mandates disclosure. A franchisor must obtain registration of its offering with the State of Minnesota before it can offer or sell franchises to residents of, or locations in, Minnesota. How can franchisors best manage and maintain their supply chain integrity while ensuring it aligns with both legal standards and brand expectations? Franchisors should thoroughly vet suppliers before allowing them to service their system. Any products or services integral to the franchise What are some key legal considerations when structuring a new franchise relationship for an emerging franchisor? There are various legal considerations, but business considerations are just as important—scalability, margins, established processes, and the ability to teach, motivate, and enforce. If the underlying pillars of the system have not been established, it will be very difficult to achieve success. In terms of legal considerations, it is imperative to address the term of the relationship, the ability and conditions for renewal, the fees to be charged, the obligations of the parties, protections of intellectual property, conditions for transfer, dispute resolution, and post-term provisions. How do Minnesota’s franchise registration and disclosure laws compare to federal regulations, and what challenges do franchisors typically face in complying with these? Minnesota’s law is one of registration that are to be provided by suppliers should be reviewed and approved by the franchisor. Franchisors should also commit to performing regular quality assurance inspections at irregular intervals to ensure that the supplier’s facilities and products are consistently meeting the franchisor’s standards. What steps should a franchisor take to protect their brand and intellectual property, especially when entering new markets or expanding internationally? It is imperative that the franchisor secure its intellectual property before If the underlying pillars of the system have not been established, it will be very difficult to achieve success.

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