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How to Start the Process of Buying a Franchise

Many people who think about buying a franchise are attracted to the security of a proven track record, brand recognition, marketing assistance, training and ongoing support.  But the cost to get started can be expensive and there are no guaranteed profits.  Additionally, your independence can be limited, as most franchisors have standards with which franchisees must comply.

Research is the most important thing you can do, if you are considering to buy a franchise.  According to Jason W. Power, a principal at franchise law firm Shelton & Power LLC, here is some advice on how to do this…

It is important to begin by looking at a wide variety of franchise systems.  Compare the similarities and contrasting differences between them.

Gather as much information as possible about the franchisors you find most interesting and carefully review all of the materials you get.  Web portals and franchisor websites are great places to find valuable facts.

Communicate with the franchisors to get more information.  You can call the companies directly and ask questions.

Talk to as many existing and former franchisees as possible to get the real scoop.  Ask them about their experiences and the support they have received.

Seek information about the franchise systems with the Better Business Bureau and other agencies to see if there is a record of complaints.  If a local franchisee has a bad rating, this can have a negative impact on you.

Obtain professional advice.  A franchise consultant, broker or coach can provide excellent guidance.  Invest in a lawyer to review the Franchise Disclosure Document (FDD), the legal document that the Federal Trade Commission requires franchisors to provide.

Click here to read the full Entrepreneur article about Power’s advice on researching franchises.

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