Are Changes to the Federal Trade Commission's Franchise Rule in Our Future? [Franchising USA]

Susan Grueneberg authored an article about the impact the Franchise Agreement mandated by the Federal Trade Commission's Franchise Rule will have on 2021. Franchising as a method of product and service distribution has been wildly successful, constituting an ever-growing percentage of business activity, both in the United States and worldwide. 2021 and the post-pandemic economic environment are likely to see even more accelerated growth as disillusioned former employees seek more control over their financial security by purchasing franchises and owning their own businesses.

While the public health crisis we have experienced has meant disaster for some concepts, for others it has spurred creativity and innovation. Many of the adaptations that have surfaced such as ghost kitchens and increased online marketing, are likely here to stay. But there is still a long road to recovery ahead.

In the midst of this, there have been signals that the legal regulation of franchising may be changing. Nationally, franchisors are required to provide prospective franchisees with pre-sale disclosure and observe a cooling off period before signing a Franchise Agreement or accepting any consideration. 

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Susan A. Grueneberg


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