Franchising your business: approving future premises

Your business performs well at its original premises. But its results may depend on exceptional visibility, a longstanding low rent or a layout that is hard to replicate. Before welcoming new entrepreneurs into your franchise network, formalise how you will approve their premises. The aim is to check that a site genuinely allows the concept to operate, without making decisions on the franchisee’s behalf or promising commercial success.

1. Turn the original premises into criteria you can apply elsewhere

Start by distinguishing what makes the concept work from what simply reflects your business’s history. Is a large stockroom essential, or does it compensate for inefficient organisation? Does an outdoor seating area generate a significant share of trade, or is it simply a bonus?

Create a site requirements checklist covering three categories:

• Essential requirements: electrical capacity, extraction where needed, delivery access, storage capacity, accessibility or a layout that supports the customer journey.
• Flexible parameters: frontage width, allocation of floor space, counter position or number of seats.
• Grounds for rejection: technical obstacles that cannot be overcome, permitted use that is incompatible with the business, or building works that make the project financially unviable.

Do not simply copy the specifications of your existing premises. For each requirement, explain its purpose and how to check it. A documented constraint is easier to justify than an aesthetic preference presented as an absolute rule.

If you have only one outlet, make the limits of your experience clear: a layout you have never operated remains an option to assess, not a proven variation.

2. Compile a file before any irreversible commitment

Ask the prospective franchisee to submit a standardised file for each property under consideration. It should help identify difficulties before a lease is signed or building work begins.

Include dimensioned plans, photographs, proposed financial terms, the draft lease, available information on technical installations and, where relevant, the building’s co-ownership regulations. Add on-site observations of access, deliveries and visibility at different times relevant to the business.

Assign responsibility for each check. The franchisee gathers the documents and manages their project. The franchisor assesses compatibility with the concept. A suitably qualified professional examines technical constraints, while a legal adviser reviews the lease and proposed commitments.

The permitted use specified in the lease must allow the intended business activity. Planning rules, any restrictions under the building’s co-ownership arrangements and French requirements for premises open to the public must also be examined. Depending on the work and the business activity, specific permissions may be needed.

Allow for three possible decisions: approval, approval subject to specific conditions, or rejection with reasons. Each condition should identify the missing document, who is responsible for obtaining it and when the condition must be satisfied. ‘Subject to compliance’ is too vague to guide a decision.

3. Define the legal scope of your approval

The franchise agreement should specify what your approval of premises means. Does it confirm that the site meets the business format, approve the fit-out plans or cover a broader review? Avoid a situation where a simple signature on a plan could be interpreted as blanket approval of the project.

The franchisee remains a legally and financially independent business owner. Your approval does not replace their own checks or the necessary administrative permissions. However, a clause confirming that independence does not absolve you of liability for failings in the advice or information you provide.

In France, franchising is not governed by a single dedicated legal framework. General contract law applies, alongside specific pre-contractual disclosure rules where the relevant conditions are met. Article L. 330-3 of the French Commercial Code, introduced by the Doubin Law of 31 December 1989, covers arrangements in which a trade name, trade mark or trading sign is made available in return for an exclusive or near-exclusive commitment in relation to the business activity.

Under these rules, the pre-contractual disclosure document and draft agreement must be provided at least twenty days before signing or, where applicable, before any advance payment. Article R. 330-1 specifies the information required. Coordinate the property search with this timetable, rather than using pressure to secure a lease to rush the prospective franchisee into a commitment.

4. Keep a clear decision trail through to opening

Record the decision in a dated approval form: the version of the plans reviewed, documents consulted, conditions, reasons and signatories. If the project subsequently changes, identify which alterations require a fresh review, such as removing a stockroom or moving an essential piece of equipment.

Before opening, check that any conditions within the scope of your approval have been satisfied. Clearly distinguish this stage from regulatory checks: your commercial go-ahead is not an administrative authorisation.

Finally, retain the lessons learned from the first openings to refine your criteria. This shared knowledge helps the franchise network make more consistent decisions.

Key takeaway: prepare a criteria checklist, a standard application file and a written decision. Approve the premises’ compatibility with your concept without turning that approval into a promise of profitability.