There will be a huge number of restrictions because franchising is about the franchisor developing systems and requiring franchisees to work strictly to those systems. There are a number of reasons for that. The first is that the franchisor will have, or should have, established that compliance with its systems means that franchisees will have a successful business and, secondly, it is important that customers, wherever they may be, know that whenever they make use of a franchised outlet, the products and services are provided in a consistent way.
This means that, in practice, the franchisor will regulate all aspects of the business both through provisions in the franchise agreement and in the operating manual – this is the manual that tells franchisees how to operate their business and which can be varied at any time by the franchisor. The franchise agreement will require full compliance with the operations manual and will make a failure to do so a breach of the franchise agreement. The franchise agreement itself will concentrate on the most important restrictions and obligations and will deal with ensuring that franchisees devote their whole time and attention to the business, may include provisions concerning pricing (although minimum prices cannot be set) and deal with a franchisee’s use of the internet and so on. All of these restrictions are imposed for the benefit of franchisees and the franchise system. No franchisee would want another franchisee doing things that bring the business into disrepute and thereby have a negative impact on his own business.