From Compliance to Growth: Legal Strategies That Drive Restaurant Success

As the franchising industry continues to evolve in 2025, the importance of legal strategy in driving growth has never been greater. From local markets to the national landscape, operators must stay informed and take the necessary steps to ensure compliance at every stage of their business journey.

With more than 25 years of combined experience in corporate governance, legal strategy, and risk management, I have come to recognize the vital role that understanding legal strategies plays in driving successful franchise growth. Below are key strategies for franchise brands to build a robust legal framework that will secure their future.

Building a strong foundation for franchise compliance

Placing a strong legal foundation is crucial when it comes to scaling and succeeding. Brands need to ensure compliance with state and federal regulations through every step of their operations, and legal infrastructure serves as the backbone of each process to protect the brand or company. It can be a tedious task to ensure that the entire franchise system is upholding operational standards. However, building out a clear, comprehensive framework from day one of each franchise agreement signed can help to ensure seamless operations.

When franchise partners become part of a system, many lack the necessary legal experience, relying on the franchisor to take the responsibility to establish a solid foundation for them ahead of time. Failing to comply with local, state, and federal regulations can jeopardize a franchise partner’s investment and tarnish the franchisor’s reputation. Consistent training programs and concierge support help simplify compliance, allowing the entire franchise system to focus on strengthening the brand, rather than being bogged down by legal concerns.

Simplifying M&A negotiations and risk management

As many franchise brands aim to expand on a certain timeline, mergers and acquisitions (M&A) begin to become a major consideration. For portfolio companies, such as Craveworthy Brands, having a clear legal strategy is key in ensuring compliant and strategic transactions, as these negotiations are inherently complex. As general counsel, one of my roles with Craveworthy is to oversee all M&A negotiations, including identifying risks, intellectual property concerns, and safety and franchising intricacies.

Having a well-crafted legal playbook simplifies the process and mitigates risk. In these types of business decisions, always aim to be as many steps ahead as possible, and account for multiple outcomes and scenarios. This allows you to be nimble and pivot when necessary. When working in franchise systems, the goal is to minimize the disruption of operations, so having a curated and detailed plan allows for smooth transitions, aiding in long-term success.

Navigating changing regulations in an evolving landscape

Today’s business landscape is unpredictable, and staying ahead of new regulatory changes is a crucial challenge for franchisors, even more so when the goal is to expand the system. Labor, safety, and franchise laws are all evolving as the Federal Trade Commission (FTC) continues to look at franchising through a sharp lens.

Building out a forward-thinking franchise system and adapting business practices not only helps eliminate the potential for legal risks, but also reiterates that as a brand or company, you are cautious, compliant, and aware of all current laws and regulations.

Growing a franchise brand the correct way involves taking the legal foundations and approaches put in place from day one and evolving them on a large-scale perspective. Expansion is complicated and requires jumping through legal hoops, but having a solid infrastructure allows for efficient growth and great opportunities in the future.

The ultimate foundation of the franchisor-franchisee partner relationship is trust. By putting the right legal systems in place, franchisors establish this bond while creating a solid base for fruitful growth, ensuring the system always remains ahead of the curve. With the legal landscape of franchising constantly evolving, those who stay informed and adjust their operations will be best positioned to thrive.

John Silvestri, J.D., is the general counsel of Craveworthy Brands.