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Franchise ABCs

Business savvy and industry knowledge are the best tools you can equip yourself with when preparing to start a franchise. The Franchise Guy can provide you with this invaluable information and guidance as you work your way through the red tape of financing, acquiring rights, and ultimately starting a franchise.

Acquaint Yourself With Franchise Language
Key terms to get you started:

Established Franchise: An established franchise provides the benefit of name recognition that carries a loyal following, in addition to a successful business model to base your own business methods on as you start a franchise.

Exclusive Territory: The franchisee and the franchiser form a non-compete agreement that prohibits the franchiser from opening a new branch within the franchisees' established territory.

Federal Trade Commission (FTC): is a government agency supporting the Federal Trade Commission Act of 1914 to promote consumer protection and prevent anti-competitive business acts. Passed in 1979, FTC Rule 436 was specifically written to regulate the franchise industry. Additional information can be found at www.ftc.gov.

Franchisee: An owner of a franchised business branch. A franchisee may own one or more franchised businesses and play an active or a passive role in their investment.

Franchiser: The individual or corporation that owns the rights to a franchise. The franchiser places great value on a recommendation from a franchise consultant who will introduce you to the right franchise representatives.

Franchise Consultant: A franchise consultant helps you to select a franchise business that fits your lifestyle and fulfills your aspirations, in addition to establishing your expectations, securing financing and preparing you to meet with the franchise representative. The franchise consultant is an invaluable resource who's working in your best interest - at no cost to you!

Initial Investment: Includes a franchise fee paid to the franchiser for licensing and the rights to open a branch of that franchise. This is a portion of the overall cost of starting a franchise that may include legal fees, leasing fees, staff and equipment expenses.

Be Prepared Financially
Getting the Franchise Financing You Need:

  • A franchised business may be easier to obtain financing for as a successful franchise has a proven track record that lenders know and trust.
  • The Small Business Administration (SBA) loan program helps you to secure a loan with the SBA guarantee using Certified Lenders or Preferred Lenders - additional information is available at www.sba.gov
  • Consider an IRS-approved method to invest your 401k or IRA into a franchised business without penalty, taxes or loan repayment.

    A franchise business opportunity consultant can help you to determine the financing method best for you.

Consider Your Franchise Business Opportunity Investment Choices

New Franchise: A newer franchise offers a fair amount of flexibility and innovation in your business methods and can also offer you the opportunity to share in company growth and profits.

Qualified Questionnaire: An online questionnaire used to assess your aspirations, qualifications and investment potential to help your franchise consultant determine what type of franchise will meet your lifestyle needs.

Please contact us for more information about the ABCs of owning a franchise business!


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