WHAT DO YOU NEED TO KNOW ABOUT BUYING A FRANCHISE?
Deal Points: Determine the Basic Terms of the Franchise Sale.
The Market: How Will This Franchise Perform in Today's Market. (Is it in a suitable, well established market or a new one?)
Financial Basics: Gather the basics such as profit, gross, expenses, etc. You will have to speak with other franchisees to obtain this information unless the franchisor provides earnings claims (i.e. its selected track history) shown in the UFOC.
Nature of Franchisor: Is the franchisor a stable, well run, and fair organization or is it tight lipped, cool and "strickly business" company.
Future Support by Franchisor: What do the existing franchisees tell you?
KEY UFOC LEGAL ISSUES
There are Too Many Legal Issues to Discuss All of Them at This Time.
Here are some Samples:
Encroachment (e.g. The Franchisor expands its business and intrudes on your territory.)
How Frequently Must You Remodel (or replace equipment) and over what period?
The Number of Default Notices Before Termination of Your Franchise.
THE BUYING PROCESS
Think about These Things Before They Occur:
Time Periods to fulfill your obligations after Buying
Who Does What, When & How in Order to Open
How Much Money Will You Need to do Each Task.
What Other Resources Will You Need and When in Order to Open (e.g. Architect, CPA, Attorney, Lender, etc.)
Stages of the Buying Process:
Searching for Franchises
Finding Help to Determine What to Buy. (e.g. Read Books, Talk to Franchisees, Counselors, etc.)
Contact with Franchisor
Meeting or Telephone Conference Call with Franchisor for More Meaningful Discussion.
You Are Provided with the UFOC.
Work on Due Diligence.
Start Loan Process
Discovery Day
Sign the Agreement, Guarantee, etc.
Train
Search for Lease Site
Sign Lease
Build Out Leased Facility
Grand Opening
For more information on any of our services, please contact Stephen A. Colley today.