Marketing plan or system (franchise definition)

Anyone asking whether a deal is legally a franchise meets this wording. Alberta’s Franchises Act, s. 1(1)(d)(i), starts with a right to engage in a business in which goods or services are sold or offered for sale or distributed under a marketing or business plan prescribed in substantial part by the franchisor or its associate. Section 1(1)(l) defines the plan as one that specifies a material aspect of conducting business, including, without limitation, any one or more of a listed set of items, among them price specification, sales techniques, promotional or advertising materials, training, and operational, managerial, technical or financial guidelines or assistance. See which provinces have franchise disclosure laws.

Ontario and British Columbia

Ontario’s Arthur Wishart Act and British Columbia’s Franchises Act use the words differently. Each says the “franchise system” includes the marketing, marketing plan or business plan of the franchise, and the Acts use that term, for example, in defining a material change. This entry covers Alberta, Ontario and British Columbia only; check the rules where the business is.

What to check

• Which parts of daily operation the franchisor sets, such as pricing, training, equipment or advertising
• Whether the manuals and standards are part of the agreement
• Whether the other Alberta limbs are also present: the trademark association and a continuing financial obligation with significant operational controls, or a franchise fee