Answer to Question #210255 in Management for Zizah

Question

When evaluating a global franchise opportunity, prospective franchisees must consider important legal and commercial factors before signing on the dotted line. There are many issues that should be considered depending on the chosen franchise system or business model and sometimes the industry in which you wish to operate. Please use the checklist as a guide to answer this question.

1.   Exclusivity for old town white coffee

Are you being granted the exclusive right to use the brand in the territory?

Is exclusivity against third parties or does it also include the franchisor?

Answer 1

Exclusive right acts for the privilege given to franchisee to relieve stiff competition from the franchisor or other franchisee within the old town white coffee. More opportunities are granted to the franchisee for the recovery of the initial cost of investment. The degree of exclusivity will depend mainly on the size of old town white coffee and the brand's importance. Therefore, the franchisee and franchisor need to discuss this matter before signing the franchise agreement.

          However, exclusivity may be granted depending on different clauses, such as old town white coffee achievements. Unless parties specify otherwise by limiting or keeping out exclusivity, a franchise is exclusive to old town white coffee.