Q: I am considering taking on the UK master licence for a US franchise, but how can I be sure the concept will work in a different country?
Apr 16 2007
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This is not really a legal question, but it comes down to doing research, or asking what research the master franchisor has done. There are no guarantees that the concept will work, but you should ask the master franchisor whether it has tested the concept in other markets, and do as much research as possible yourself to see whether you believe it will work in this country.
You should also consider what the differences are, for example in terms of culture and market demand, but also in terms of different legislation and different costs (for example premises tend to be more expensive in the UK). You need to consider the franchising market in the UK, if you intend to grant franchises yourself, and research the feasibility of obtaining the number of franchisees that you need in the UK.
I recommend that you do as much commercial investigation of the business and the master franchisor as possible, including considering the level of ongoing support and the financial aspects. If you are considering buying a master licence, you need to make sure that the master franchisor is as established and financially stable as possible before taking on a UK licence.
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