Can I see the franchise operations manual before I invest?

A franchisor’s operations manual is one of the most important resources for running a franchise. It contains the detailed know-how, procedures and trade secrets that make the franchise business work.

However, it’s also a highly guarded document, and prospective franchisees often wonder if they can access it before committing to an investment in their chosen franchise opportunity.

Why is the operations manual so important?

“The operations manual provides detailed instructions on how a franchisee should operate a particular franchise business. This includes know-how and details of how the franchise concept attains its uniqueness,” explains Vicky Wilkes, head of legal at Aston Villa Football Club.

It contains the franchisor’s valuable trade secrets, as well as specialised methods and techniques built up over years of experience. This makes it central to running the franchise successfully.

When will I receive the franchise operations manual?

In most cases, you’ll first interact with the manual during initial training. Shelley Nadler, legal director at Bird & Bird, says: “It will be the basic training course textbook. It will then be provided to you on loan so that it is available as a continuing guide to help you run your business.”

The manual is usually provided once the franchise agreement is signed. This is because it contains confidential information that the franchisor wants to protect.

Can I see the operations manual before signing the franchise agreement?

This is often a delicate balance. The manual may include commercially sensitive information. This means franchisors are generally reluctant to release it before a commitment is made.

Vicky Wilkes notes: “While you’ll want to review the operations manual to see what is required to operate the franchise business and assess any costs that may be involved that are not apparent from the franchise agreement, a franchisor may be reluctant to let you. This is because of the nature of its content.”

Confidentiality agreements

Sometimes a franchisor may allow a potential franchisee to view the manual under a confidentiality agreement. There may also be restrictions on you using the knowledge you obtain from the franchise operations manual in another business.

Are there exceptions?

In some cases, the manual may contain little commercially sensitive information. This means a franchisor may be willing to share it as part of the franchise package.

However, it is ultimately at the franchisor’s discretion.

Vicky Wilkes advises: “A prudent franchisee should research as much as they can about the franchise business before entering into the agreement. If the franchisor cannot provide enough detailed information for you to assess the potential of the franchise business, it may be worth considering if it is a risk you should take.”

Conclusion

The operations manual is an essential tool for operating a franchise, but its sensitive content means access is typically only granted after signing the franchise agreement or under a confidentiality arrangement.

You should carefully review your franchise agreement, understand what information you’ll receive and consider whether you have sufficient insight into the business before committing.

While it may be frustrating not to see the full manual upfront, these safeguards protect the franchisor’s intellectual property.