Who pays for a franchisee’s initial training?

The cost of initial training is often included in the ‘initial franchise fee’. Sometimes the franchisor will charge a separate fee for initial training, or for training additional staff of the franchisee.  The initial fee varies from company to company and is paid by the franchisee when the franchise is granted. The initial franchise fee can include the cost of training, recruiting, territory analysis, site identification, specialist equipment, stationery and the franchise launch. Also, some franchisors will charge a ‘training deposit’, which is refunded on completion of the training. The franchise agreement should make it clear if the cost of training is included in the initial fee, or if the franchisee will be expected to pay for this separately. If this is not clear, further enquiries should be made of the franchisor.  It is usually the case that the franchisee has to pay his own travel, accommodation and subsistence costs in attending initial training, and also those of any of his employees attending such training.  It may be that when you are required to attend initial training you have only paid over a deposit. In that case, there should be a deposit agreement and you will need to check with your solicitor whether the agreement will allow for your deposit to be returned if you do not successfully complete the initial training course. It is usually acceptable for the franchisor to deduct a reasonable amount from your deposit to cover the cost of providing the initial training course.