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Do Oral Contracts Work With Franchise Opportunities for Sale?

February 19, 2012 | Comments: 0 | Views: 145

I often ask my clients about what they would prefer as a contract when dealing with a franchise for sale. Be it the business students I train or the professionals who are already working with franchise opportunities, very few would agree to the fact that an oral contract can hold the legal power that a written or printed contract does.

However in reality, an oral contract can be as legitimate as a written or printed contract proves to be - but there are certain conditions and requirements that make things work. Let us have a look at some requirements that you need to meet to make an oral agreement for a franchise for sale as legitimate as any other.

Having a Witness

A witness is one of the principal factors that help you strengthen an oral agreement. The presence of a neutral third party who has no interest in the agreement or the business associated with the agreement can help seal contracts related to franchise opportunities. However, there are a few factors to consider when deciding on the witness you plan to work with.

First of all, make sure the witness has no interest in the deal. This is very important to make the claim of the person legitimate when required. Any interest or association with the franchise for sale or the parties signing the agreement will surely make your case weak.

Always Have Supporting Materials Ready

It is very important to keep collecting all the documents, receipts and other supporting material that directly or indirectly point at the clauses agreed in the oral contract. This strengthens your case and helps you to logically prove all that was decided.

For example, if you have decided to pay the actual owner of the franchise for sale a percentage of the profit you make, make sure you collect all the receipts of the payments you make to the owner and have the details of the profits you have made as well.

Moreover, you may get a note signed by the owner every time you make a payment that they have received the exact percentage of the profit as was decided in the oral agreement. This ultimately helps in sealing the oral contract.

Supporting materials are very crucial in an oral agreement involving franchise opportunities and should never be overlooked for the best results.

Converting into Print

Oral agreements are often made when you don't have enough time to go through a printed or written agreement. The parties often decide to get back together and formulate a standard written contract for future reference and clarity of the deal.

If you too have got into an oral agreement because the situation demanded so, it is a good idea to convert the terms and conditions into a printed document without delay.

Even though both parties involved in an oral agreement may fully support the terms and conditions decided initially, differences in opinion may ultimately result in making things go wrong, especially when the agreement covers too many complex terms.

It is therefore a good idea to put down your oral agreement into print and get it signed by both the parties involved to prevent any further issues and operate the franchise opportunity smoothly.

Do you want to know more information about Franchise Opportunities and Franchise for sale? Check out the website

Source: EzineArticles
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