last updated 12/12/2019
Why deal with a FANZ member?
last updated 12/12/2019
If you’re looking at buying a franchise, it’s worth checking to see if both the franchise system and your advisors are members of the Franchise Association of New Zealand.
What difference does it make dealing with Franchise of Association of New Zealand members?
The Franchise Association (FANZ) was founded in 1996 and is the only body which sets standards for franchising in New Zealand. Members are only accepted after undergoing independent scrutiny to ensure that their documentation and agreements comply with the Association’s rules. These can be downloaded here.
Members must also undertake to abide by the Association’s Franchising Code of Practice and Code of Ethics, which define standards of conduct in keeping with international best practice and include safeguards for buyers.
Dealing with FANZ member franchises
The requirement for franchisors to provide a disclosure document to all prospective franchisees at least 14 days prior to signing a franchise agreement. This must include (in summary):
- A company profile with details of the company and its officers;
- An outline of the franchise, including details of all payments to be made by the franchisee to the franchisor including deposits;
- Disclosure of any commissions payable to advisors or brokers;
- A list of components making up the franchise purchase with details of fees and costs.
Two other important benefits of dealing with FANZ member franchises are:
1. Franchise buyers are granted a 7-Day ‘cooling off’ period following signing a franchise agreement which gives you the chance to confirm your decision;
2. Every agreement issued by a FANZ member franchise is required to include an alternative dispute resolution provision which allows for faster and cheaper resolution of problems in many instances.
Dealing with FANZ member advisors
Affiliate members of FANZ includes specialist advisors in many areas, including:
- Bank Managers
- Service Providers
Franchising can be complex so it pays to use specialists who understand the issues and have knowledge of what to look for and how to help you evaluate your own situation. Affiliates are required (in summary) to:
Detail their relevant qualifications, franchising education and experience;
Respect the confidentiality of all information received;
Disclose any personal or financial interests or other material circumstances which may create a conflict;
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