Help With Franchising

Discussion in 'Growing and Managing a Business' started by Playerdeveloper, Mar 14, 2012.

  1. Playerdeveloper

    Playerdeveloper
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    A close friend of mine wants to buy into my Sports Performance business as a franchise. If I consider should I add him into my LLC and if so what would his title be (member, franchisee,officer, etc.) Also as far as banking purposes should he get is own Tax ID number, even though the checking account would be under the same business name as my company? Franchising is new to me and I need some advice of how to proceed. Thanks
     
  2. KJMS-Chris

    KJMS-Chris
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    Most franchises are sole proprietorship (d/b/a) so I would make him get his own LLC / sole proprietorship because this could lead to problems later on down the road. Prime example: the Facebook fallout between Zuckerberg and the finance guy (I can say his name but not spell it). A franchise is seen as a separate business than you and your business' LLC. Honestly, spending some cash to talk to a lawyer will help you out tremendously down the road.. maybe offer him some stock in exchange for free legal advice ;-)
     
  3. jcworlditsme

    jcworlditsme
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    I agree, partnerships can often be troublesome, especially for lucrative businesses.
     
  4. honitel

    honitel
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    Partnership is okay as long as you are sure and your partnership will lasts than sole proprietorship. KJMS-Chris has a point somehow!
     

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