Franchise Agreements and Hurricane Clauses

By: Lance Winslow
Submitted: 2007-01-17 12:44:00
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Have you considered franchising your business? Well many business owners wish to do this. Franchising can be a great method for rapid expansion and brand expansion but do not forget about the weather. The weather? Come again? What on God’s Earth does the weather have to do with franchising one’s already successful business?

Well a lot more than you think. In fact in our company we had to put a weather and natural disaster clause in our franchise agreements in order to protect our selves and our business against potential eventualities concerning Mother Nature. Below is the clause I came up with for our franchise agreement after I reviewed a about 50 other franchise agreements to see how they dealt with this issue of adversity that our franchisee outlets had to deal with:

“7.23 Force Majeuer

If there is a fire, flood, hurricane, tornado, earthquake, riot or bombing in the Marketing Area which significantly reduces Franchisee’s ability to work, no royalties will be charged to Franchisee during this time and in major disasters for thirty (30) calendar days following. Franchisor hopes Franchisee will join local disaster relief efforts as soon as their family is taken care of and out of danger.”

It is important in a franchise agreement to be fair to your team and thus with the wicked Hurricanes we have been having each year along with some of the other floods, fires and other natural disasters it makes sense to think ahead and come up with your own plan and policy in advance to deal with these things. Consider this in 2006.

Lance Winslow

Article source: Expert Articles

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