Across the country and even around the world, franchising has become increasingly popular. There are many people involved in the operations of franchises, and those who are interested in starting a business without having to do all of the legwork or marketing might consider opening a franchise as one way to fulfill their dreams of small business ownership.

When an individual or partnership purchases a franchise, they do so after signing a franchise agreement. This agreement, like many other contracts, provides the basics of the responsibilities of the franchise owner. Although it's advised that a new franchise owner put in some serious time reviewing this document, and in fact having it looked over by an attorney, problems can arise down the road as a result of terms in this contract. Some business owners might find the stipulations of the agreement oppressive or difficult to fill. This is one of the downsides of owning a franchise, since the business owner has to comply with the business standards and operation requirements of the "mother company." This is the tradeoff in ownership, since the business owner gets the benefits of launching a business through the franchise channels but also has to operate the business under someone else's rules. Many times, these franchise agreements have led to legal disputes. As the franchise grows, so does the number of people involved and the potential for disputes. Many well-known franchises, like Quiznos and Sears, have been involved in litigation regarding the franchise agreement.

Although many of these disputes have landed business owners and franchisees in court, there are alternatives. Mediation and arbitration are growing in use throughout industry and dispute types, making them some of the most popular ways to resolve conflicts. Taking the dispute out of the courtroom and using alternative methods can, in many cases, lead not only to a faster resolution, but also to lower overall expenses. Most of the time, a franchise agreement must be signed with little or no room to negotiate for the franchisee. On the franchisor's side, a public lawsuit can pose a lot of risk in the form of public image damage. Resolving their differences behind closed doors tends to be much more efficient for each side to air grievances and work through the crucial case issues. Mediation and arbitration are already successful at resolving dispute across the spectrum, and it's likely they can be instrumental in franchise disputes.