Many franchise lawsuits involve disputes over territorial rights. On one hand, a

Question

Many franchise lawsuits involve disputes over territorial rights. On one hand, a valid contract that grants exclusive territorial rights to a franchisee deserves to be enforced, just as any contract does if the parties have voluntarily agreed to its terms. On the other hand, the Internet offers franchisors an inexpensive marketing vehicle, which, according to some, they should be able to utilize. If franchisors are prevented from any direct competition with their franchisees via the Web, franchisors may stop granting exclusive territorial rights to any of their franchisees - which, of course, could also be detrimental to franchisees. What is your opinion on this issue? Should a franchisor be able to market its goods on the Internet, even though customers in its franchisees' exclusive territories may purchase the goods directly from the Web site? Why or why not? The subject is legal environment of business.

Explanation / Answer

Internet is now a days the most effective communication channel and also a portal for dealing the business. The accessibility and easiness increases e- commerce business reach and popularity. The franchisor franchisee model can utilise the effectiveness of internet to an extent. For this to achieve both franchisor and franchisee must enter to an agreement in which area and type of internet sales and purchase has to be standardised.

They must realise the potential of internet medium and the agreement must contain what type of sales they are planning through e-commerce and purchasing limit and source of purchase as well. This helps both parties to agreed on mutual consent and utilise the internet medium to enhance their business. If a material is purchased directly from website without informing franchisor, it has to be considered as breach of norms.

Related Questions

Navigate

• Browse (All)
• Browse M
• Subjects

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.