While creating an operations manual for a franchise, you should be wary of some common mistakes that franchisors make. The franchise operations manual is not the company operations manual with a different title.

If a franchisor possesses a company operations manual, it should be edited to help franchisees with maintaining system standards while not stating the exact means of how a franchise is to operate, e.g., dictating the specific selection method of franchisee employees.

In other words, a franchisor must not micromanage the franchisees day to day activities in the operations manual due to the increased risk of vicarious liability.

Useful provisions that the franchisor might consider adding to the operations manual include a confidentiality provision and a provision stating that the franchisee must obey all federal, state, and local laws. The confidentiality provision is especially important to convey to the franchise at each step of the process because, in the event of a dispute, the franchisor demonstrates this fact and ask the court for an injunction.

Furthermore, if the franchisor desires to use PowerPoint presentations or other means of presenting the operations manual, it is recommended that all such material be identified as a supplement to the manual.

For further information on how to avoid potentially damaging mistakes found in the operations manual, contact franchise attorney Mario Herman.