Step #4 gives you tips on what you should expect after your first phone call with the franchise company's salesperson:
After your initial call with the franchise director, you will be excited about the prospect of learning more about the opportunity. There will be a second call scheduled, and the franchise director will get into more data with you at that time. Before the second call, however, there will be some paperwork to fill out. You will fill out a formal application, which will ask for more specific information about your backgrounds, and financials. You will sign it, and send it in, via mail, e-mail, or fax. What you signed will give the franchisor permission to do background and credit checks on you. They, of course, want to make sure you are totally qualified to become a franchisee with their franchise concept, if they decide to offer you a franchise. The decision to become a franchisee with a particular concept is of course yours at the beginning of the process, the franchisor in the middle of the process, and back to you again at the end. A good franchise company does not offer a franchise to everybody that is interested in it.
A good franchisor only offers a franchise to the folks that are financially qualified, have the needed skills for success, and are all around a great fit for the franchisor, and the franchisors vision for growth.
The final decision will be yours, however, if you are offered a franchise.
After you fill out and submit the formal application, you will be sent the Franchise Disclosure Document. (FDD) This is a document that they must get to you, and it's required by the Federal Trade Commission. Some franchise company’s send it to you with the marketing materials, some send it after the initial conference call, and some send it to you after they take a look at your formal application. Some, however, don’t disclose the FDD until you visit the franchise company’s headquarters in person. Although not very common, this practice can be unsettling. In my experience, if the franchisor won’t send you their FDD early in the process, there is a reason. There may be some negative information in the document that they would prefer to explain to you in person. Maybe they just like to disclose you in person. Personally, if a franchisor insists on disclosing their FDD very late in the process, I would walk away, unless they, without argument, agree to send it sooner.
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