Franchise Disclosure Document #1 Franchise Hotline Question This Week

What can you learn from the Franchise Disclosure Document?

A lot!  Many people wonder what information the Franchise Disclosure Document contains.  It is a very important document for anyone who is seriously considering a specific franchise.  The document contains the history and experience of the officers and directors of the company.  This gives you an important window into the expertise of the management team.  It must also reveal whether there has been any recent litigation or bankruptcy history.

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The company must also let you know the initial franchise fees, any startup costs and an investment range for the total cost to get into the business.  If there are other fees like royalties, marketing or renewal fees, these are also revealed in the Franchise Disclosure Document.

Other items include territories, obligations, financing programs and renewal fees.  Some franchises include an earnings claim.  The law requires that they have a reasonable basis and proof for their claims.

If you are seriously considering a franchise, search for more detailed information on the Franchise Disclosure Document before you purchase a franchise. If you are ready to start your search, check out Franchise.com for a list of franchise for sale.

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