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Can I own more than one franchise?
Most franchisors impose an obligation on their franchisees to devote their whole time and attention to the franchise they grant. The reason for this is obvious - franchisors want franchisees to ‘bust a gut’ to make the franchise successful and don’t what their franchisees to be diverted by other business activities. Occasionally when franchisees are recruited, because they are already involved in the proposed franchise activity, franchisors will allow franchisees to continue to be involved in such activities. It would be most unusual for a franchisor to allow a franchisee to enter into a franchise offered by another franchisor, whether in a related area or not. The fear would be that the franchisee would not devote sufficient time to both franchises and one franchise would inevitably lose out. Notwithstanding the above, some franchisors are keen to encourage their franchisees to take additional franchise territories if they make a success of their original franchise purchase. Indeed, some franchisors have formalised this arrangement by granting franchisees a development agreement so that if they successfully operate their first franchise they then have rights to open additional outlets. This approach is not currently common practice but is being used increasingly in the food sector.
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