Franchise Disclosure Agreement

Franchise Disclosure Agreement is one of the most important documents while signing the Franchise form. This is the document that contains all the necessary information about the franchise. It usually consists of 100-200 pages and is sent to the franchisees two weeks prior to the contract signing. There are a total 23 sections in the Agreement. FDA or Franchise Disclosure Agreement helps the franchisee in knowing the background of the franchise. All the terms and conditions of the franchise are quoted in this agreement. Thus, helps the new franchisees to know about the rules and regulations of the company. One should be very careful while going through this document. As we all know, finances are the most important factor that franchisee has to consider. So, all the information about the royalty fees, marketing fee, etc is mentioned in this agreement. Also, make sure that the high fees that you are going to pay will be worth or not. Go through the agreement properly and pay attention whether the franchisor will be providing you a good training or not. It is important because training and the ongoing support makes an important part of a good franchise. Even if the franchisor is known to you, one cannot afford to overlook the importance of a Franchise Disclosure Agreement. It is always recommended to go through the history and background check of the franchise. Pay special attention whether the franchise has any litigation history or not. Financial performance of the company is another important factor to be considered and you can get to know about it in section 19 of the FDA. In section 20, you will find out about the total number of franchisees under the franchise. Even though the agreement is too long to read and could be really boring but still you can’t afford to ignore its importance.