FINDING THE RIGHT FRANCHISE
5-Step Process

Step 1: Information Gathering. You will initially be asked to answer some brief questions and fill out a qualifying form to determine a match of characteristics between you and appropriate franchise opportunities. Shortly thereafter, the broker will supply you with information regarding the franchise(s) of interest. Unless there is already a predetermined area or franchise(s) of interest, a list of potential franchises will be compiled and finalized to qualify them based on the entrepreneurs background and specifications.

Step 2: Review Information. Information obtained in the form of brochures, video media (CD's, VHS, etc...), financial's and the Uniform Franchise Offering Circular will be investigated. The Uniform Franchise Offering Circular (UFOC) is a critical tool at this juncture. The UFOC is a Federal Trade Commission mandated disclosure document that gives a wealth of information about a franchisor. The composition of the document is fairly standardized but must include: - Franchise History. - Complete business description. - Total cost of the franchise - Obligations of both parties to the agreement - Litigation history of company and its officers - Financial statements for the prior three years - Listing of all existing franchisees. This UFOC document should be carefully reviewed and any questions or issues discussed with the franchisor. This could involve outside counsel (possibly a lawyer) to review pertinent material.

Step 3: Reference Existing Franchises. Very valuable source of information can be obtained from existing franchisees. An attempt should be made to contact a number of them. This can aide in determining the existing attitudes of current franchisees. Try to get a good cross-section of franchisees (not just the happy one's). Ask questions and listen to any complaints to get a good overall feel for the franchise. Some good areas of focus include: Training and Support: Were other franchisees prepared for opening and the future. Opening Support: Was there assistance in site selection, lease negotiation, financing, business permits. Ongoing Support: Was the franchise effective at dealing with problems that arose during the course of business. Franchise Marketing Programs: Does the franchise collect marketing dollars from the franchisees and the franchisees supportive of the program. Purchasing Power: Does the company effectively leverage its buying power to get discounts beyond what an independent could achieve. Franchise Investment: Make a determination on the total investment needed to b e successful in your market or region. Earnings: Don't be afraid to ask. It's important to have a guide as to how a franchise should develop over time. It's also important to get a good judge of how other franchisees are doing.

Step: 4 Discovery Day..... Meet the Franchisor. Your focused search has resulted in serious franchise considerations. Meet with key personnel from a franchise company. Many franchisors facilitate this by holding what are referred to as "Discovery Days". These are structured events to go and meet the key people from a franchise. Get to know these key people. Make sure any remaining questions are addressed.

Step 5: Make the Decision. A diligent process concluded over the span of two to four weeks should allow you to formalize a decision. You have now finished your investigation and have all the information you need to determine if this franchise is right for you. It either is or it isn't...you'll know which it is. In either case, it is time to make a decision and move on. Use the model you developed for yourself to evaluate what you wanted in a business. Don't settle. If this company has everything you wanted... do it. If it doesn't, eliminate it and go to the next one.