Thinking of buying a Franchise? Do Your Homework!

Thinking of acquiring a franchise?  You’ll want to do your homework.  It is said that buying a franchise allow new owners to be in business for themselves but not bythemselves. Most franchisers charge royalty fees to the franchisee for systems and operational support, marketing and oftentimes, product discounts. Franchises vary greatly in the depth and quality of their support and in the fees they charge.  They will require the owner to use certain colors, signage and other marks that identify the franchise. They will require certain hours of operation and methods of work that will serve to build the brand.  The owner must agree to a multitude of undertakings to promote the brand identity, and most of it will come out of pocket. And speaking of out of pocket, the franchiser usually has direct access to your Point of Sale (POS) system with the royalties being drafted directly from your bank. That’s a lot of control to hand over to somebody else, but then again, they provide a lot of support to ensure your success. OR DO THEY?
Begin your research at The Blue MauMau, http://www.bluemaumau.org.  I have found this to be the most information intensive place to learn about franchises. There are articles, business tools and directories on the site.  Lists of best and worst franchises and those that tend to fail more than others.
Study the Franchise Disclosure Documents (FDD) of those franchises of interest. Most of the requirements for Franchise ownership are spelled out in the FDD.  It is probably the single most important document to read and understand because your business life will be driven and regulated by it as long as you own the business. The OpenFran project at http://www.openfran.org is a site where FDD’s for many franchises are archived and may be downloaded at no cost.
I would welcome comments or other sources that you may come across to research franchises.

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