Franchise Disclosure Document is Imperative to Start With

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Franchise Disclosure Document is Imperative to Start With

Posted On : Nov-28-2011 | seen (271) times | Article Word Count : 511 |

Franchise disclosure document is a necessary task that has to be completed for buying the franchise or enjoying benefits of its consulting services.

A franchise disclosure document (FDD) is a legal document which is presented to prospective buyers of franchises in the pre-sale disclosure method in the United States. It was originally known as the Uniform Franchise Offering Circular (UFOC) (or uniform franchise disclosure document), prior to revisions made by the Federal Trade Commission in July of 2007. Franchisors were given until July 1, 2008 to fulfill with the change. The Federal Trade Commission Rule of 1979 which governs discovery of essential information in the sale of franchises to the public underlies the state FDD's and prohibits any private right of action for the violation of the mandated disclosure provisions of the FDDs. Therefore, the FDD implies that only the federal government or the state governments have the right to sue and negotiate consent decrees and rescissions with those franchisors that violate the provisions of the FTC Franchise Rule and the Franchise Disclosure Document (FDD).

Franchises are bought throughout the United States, and throughout the World, as if there was very little risk included in the purchase of retail franchises that require an investment of hundreds and thousands of dollars in order to wear the brand name of the franchisor. Those who sell franchises, and with franchise disclosure document, who profit from the sale, often stand for the franchised business as being more successful than the independent small business startup but this is not true as per to the few academics that produce research statistics on franchising, The brutal truth, however, is that the research that is available shows that ALL small retail businesses fail at a rate of 50 percent within the first five years, and only 29 percent survive as long as ten years. Why, most retail franchise agreements need that the buyer of the franchise commit to a ten year contract, and then personally guarantee the franchise, and the lease, for ten years with their personal assets, the house or the 401K, or whatever assets the franchisees may own?

The franchise disclosure document states about the franchise agreement, which is the formal sales contract between the parties at the time the indenture is formally signed. This franchise sales contract governs the long-term relationship and contains the ONLY promises and obligations of the parties to each other that will remain in upshot over the stated time term of the contracts – the terms of which generally range from five to fifteen years. The franchise disclosure document cannot be changed unless there is agreement of both parties. The probable franchisee has the right to ask for (and get) a copy of the sample franchise disclosure document once the franchisor has established the prospective franchisee’s application and agreed to consider it. The franchisor may give a copy of its franchise disclosure papers on paper, via email, through a web page, or on a disc. It is an essential document that makes the entire process easier and buyer friendly.

Franchise disclosure document is a necessary task that has to be completed for buying the franchise or enjoying benefits of its consulting services.

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<h1>Franchise Disclosure Document is Imperative to Start With</h1> Author: <a href='http://www.articleseen.com/profile_sunshineconsultingltd.aspx'>sunshineconsultingltd</a> A franchise disclosure document (FDD) is a legal document which is presented to prospective buyers of franchises in the pre-sale disclosure method in the United States. It was originally known as the Uniform Franchise Offering Circular (UFOC) (or uniform franchise disclosure document), prior to revisions made by the Federal Trade Commission in July of 2007. Franchisors were given until July 1, 2008 to fulfill with the change. The Federal Trade Commission Rule of 1979 which governs discovery of essential information in the sale of franchises to the public underlies the state FDD's and prohibits any private right of action for the violation of the mandated disclosure provisions of the FDDs. Therefore, the FDD implies that only the federal government or the state governments have the right to sue and negotiate consent decrees and rescissions with those franchisors that violate the provisions of the FTC Franchise Rule and the Franchise Disclosure Document (FDD).

Franchises are bought throughout the United States, and throughout the World, as if there was very little risk included in the purchase of retail franchises that require an investment of hundreds and thousands of dollars in order to wear the brand name of the franchisor. Those who sell franchises, and with franchise disclosure document, who profit from the sale, often stand for the franchised business as being more successful than the independent small business startup but this is not true as per to the few academics that produce research statistics on franchising, The brutal truth, however, is that the research that is available shows that ALL small retail businesses fail at a rate of 50 percent within the first five years, and only 29 percent survive as long as ten years. Why, most retail franchise agreements need that the buyer of the franchise commit to a ten year contract, and then personally guarantee the franchise, and the lease, for ten years with their personal assets, the house or the 401K, or whatever assets the franchisees may own?

The franchise disclosure document states about the franchise agreement, which is the formal sales contract between the parties at the time the indenture is formally signed. This franchise sales contract governs the long-term relationship and contains the ONLY promises and obligations of the parties to each other that will remain in upshot over the stated time term of the contracts – the terms of which generally range from five to fifteen years. The franchise disclosure document cannot be changed unless there is agreement of both parties. The probable franchisee has the right to ask for (and get) a copy of the sample franchise disclosure document once the franchisor has established the prospective franchisee’s application and agreed to consider it. The franchisor may give a copy of its franchise disclosure papers on paper, via email, through a web page, or on a disc. It is an essential document that makes the entire process easier and buyer friendly.

Franchise disclosure document is a necessary task that has to be completed for buying the franchise or enjoying benefits of its consulting services.About the Author: Author bio:

The author of this article has specialization in Franchise Concepts.His enormous experience is summed up in the article ‘Franchise Disclosure Document brings the master plans for the Franchise Opportunities’.Along with this he also provides <a rel="nofollow" href="http://www.buyafranchiseconsulting.com/franchise-tips/buying-a-franchise-the-franchise-disclosure-document/"> franchise disclosure document </a>,franchise development and brokerage services to both individuals and franchise syst Article Source: <a href='http://www.articleseen.com/Article_Franchise-Disclosure-Document-is-Imperative-to-Start-With_111167.aspx'> http://www.articleseen.com/Article_Franchise Disclosure Document is Imperative to Start With_111167.aspx</a>

Article Source : http://www.articleseen.com/Article_Franchise Disclosure Document is Imperative to Start With_111167.aspx

Author Resource :
Author bio:

The author of this article has specialization in Franchise Concepts.His enormous experience is summed up in the article ‘Franchise Disclosure Document brings the master plans for the Franchise Opportunities’.Along with this he also provides franchise disclosure document ,franchise development and brokerage services to both individuals and franchise syst

Keywords : Franchise disclosure document, Franchise System, Franchise Brokerage, Franchise Consulting, Franchise Models, Business Coaching, St,

Category : Business : Business

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