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Franchise Documents: Can I Just Switch Out My Name?

Recently, a business owner contacted us and revealed that he had obtained his competitor’s franchise documents (though he didn’t say how). He had a question he wanted to ask about “copying your competitor”.  Here’s how the conversation started out:

“I found an old version of my competitor’s franchise documents. My business is virtually the same. They’re an (ABC) company; I’m an (ABC) company! We really do the same thing! So can I just copy my competitor’s franchise documents for my own purposes by just switching out their company name for mine and be done?”

Okay, we KNOW that this thought has crossed the minds of MANY of you who are thinking about franchising. And we can understand the temptation: the idea that you can do it yourself and avoid paying someone else to handle the franchising process (see “How to Turn Your Business into a Franchise with Expert Guidance Rather than Doing it Yourself“). Copying your competitor’s franchise documents sounds like an easy shortcut, but this kind of shortcut is really not a shortcut at all and will very likely come back to bite you in the long run!

Are They REALLY The Same?

As a business owner looking to franchise your business, you must stay away from copying your competitor’s franchise documents (and let’s not forget about the problems you can get into from a copyright standpoint!). In reality, every business and how it operates is different. Therefore, every franchise program we build is different, reflecting the various unique characteristics of your business that you are wanting to offer as a franchise even if the business is similar to other franchises out there (read more about our strategy when building a franchise program for you).

One example is that the deliverables you are going to provide to your franchisees will be different than the deliverables of your competitors. In addition the way your business is setup, costs, how you purchase products, execute services and even your philosophy varies greatly from your competitor’s. These are just a few of the details that will differentiate your business and ultimately your franchise opportunity. While two businesses may appear to be the same (for example real estate companies), they operate differently. And if you blindly copy your competitor’s franchise documents, then you’re going to pigeonhole yourself into their system and way of doing things because that is how their franchise program is built.

Protect Thyself!

On an even more serious side, there will be certain sections in your competitor’s franchise documents that are outdated and won’t fully protect you. The verbiage in your competitor’s documents may not be up to date with recent franchise industry developments such as changes as a result of recent franchise litigation, laws passed or new franchising regulations. In particular you are going to want to make sure you are protected against liability claims (as part of our franchise development services we explain how you are protected as a franchisor). In a franchise-related liability claim, typically it is an attempt for someone to try and impose liability on the franchisor (i.e. make the franchisor responsible) for actions that stem from how the franchisee is operating and managing their business. As a franchisor you want to stay away from any type of liability claims.

It Is Not Worth Being A Copycat!

So embrace the uniqueness of your business and do things right from the beginning. Drop the copycat urge! At The Franchise Maker we will help discover all your secret formulas and your unique methods and techniques in order to create a customized franchise program for your business (for more on this topic you can read “A Custom Approach to Franchising Your Business”). You can call us directly at 1-877-615-5177 or simply send us your information. We will be happy to answer any questions you have about our custom franchise development process and ultimately determine if franchising your business makes sense for you.