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When does a franchisor hand over the operations manual to a franchisee?
A franchisee will first have contact with the manual during training, when it will be the basic training course textbook. It will then be provided to the franchisee on loan so that it is available as a continuing guide to help him run his business. The manual will almost always be provided to the franchisee once he has signed the franchise agreement, as it will contain provisions requiring the franchisee to keep the information in the operations manual confidential and restrictions on the franchisee using the knowledge it obtains from the manual in another business. The operations manual contains the franchisor’s valuable know-how, which is a body of knowledge built up by the franchisor through trial and error comprising the specialised methods and techniques for the operation of the business. The franchise agreement will probably refer to the operations manual on a number of occasions and many franchisees ask to see a copy of the manual before they sign the agreement. Franchisors are usually reluctant to allow this.
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