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A franchise agreement is a binding legal document between a franchisor and a franchisee. This document spells out the expectations, obligations, permissions and restrictions for operating the franchise.
When you enter a franchise agreement, the franchisor controls the name, brand and business system you are going to use. The franchisor grants you the right to operate a business in line with its system, usually for a set period of time.
According to a survey done by Franchise Business Review involving 28,500 franchise owners, the average pre-tax annual income of franchise owners is about 80,000 dollars.
The bottom line is that a strong franchise agreement is critical to the franchise system's ability to (i) meet the needs of the franchise brand's customers, including making necessary changes as those customers' needs evolve, and (ii) protect the interests of the various stakeholders who have an interest in the brand,