What Benefits Do You Get From Owning a Franchise in Florida?

While it is possible to form a Florida company from scratch, most people will benefit from purchasing an existing company with an established customer base and a proven business model. In this article, you will discover the key benefits of owning a franchise company in Florida.

Benefits of Owning a Franchise in Florida – Tax Exemptions and Other Benefits

Florida is a pro-business state. In this scenario, franchise companies have fertile soil to thrive. Among the fiscal benefits for companies, the state of Florida has:

No state personal income taxes (as provided by Florida’s constitution)
No corporate income tax on limited partnerships
No state corporate income tax on S-corporations
No corporate franchise tax on capital stocks
No property taxes assessment (at the state level)
No property taxes associated with business inventories
No taxes over goods-in-transit for up to 180 days
No sales tax on goods for exportation manufactured within the state
No use tax on goods for exportation manufactured within the state
No sales taxes on purchases of raw materials incorporated in a final product for resale

The state of Florida also grants several sales and use tax benefits, such as:

Benefits on machinery and technical equipment used by new or expanding companies to produce goods for sale
Benefits on materials used for repair and incorporated into machinery and technical equipment
Tax benefits on electricity used in the production and manufacturing of goods

Benefits of Owning a Franchise in Florida – Negotiating a Solid Franchise Agreement

Franchising companies involve several elements, such as royalties, supply chain, marketing, advertisement, etc.

The franchise agreement is the key element of a franchisor-franchisee relationship. During the negotiations, both parties must consult with an experienced Florida business attorney to ensure the document is drafted adequately. A well-drafted Florida franchise agreement must include:

The geographical area of the new franchise
The franchisee’s unit territory size
Right of renewal
Personal warranties (for both parties)
Restrictive covenants (if applicable)
Minimum performance requirements
Payment terms (in detail)
Franchising fees
Tax liabilities
The extent of support provided by the franchisor
Which type of support the franchisor must provide
The fundamental items for the new company’s operations
Intellectual property rights
The use of the franchisor’s brand
Supply chain, logistics, and quality control

As it is plain to see, enjoying the benefits of Florida’s pro-business policies requires a strategic approach. The acquisition of a franchise company is generally more complex – especially if you are the franchisee.