The Dos and Don'ts of Choosing a Franchise - Black Enterprise
Black Enterprise Magazine July/August 2018 Issue

Purchasing a franchise is a decision you shouldn’t take lightly. So before you join the franchising industry, Robert L. Purvin, chairman and CEO of the American Association of Franchisees & Dealers, suggests you consider the following:

Do look for franchises that have good relationships with their franchisees. Also, consider the franchisor’s reputation for fairness with its subordinates. You can find information on former and current franchisees in the Franchise Disclosure Document.

Don’t assume that just because you’re buying an established franchise that you’re buying a proven success. Remember even established franchises face issues over time.

Do keep good records of your research, including all your conversations and dealings with franchisors. Staying organized is key.

Do learn how the company deals with purchasing programs. Franchising offers potential buying power, and because a larger franchise system is able to buy in great quantities, it should drive the cost of doing business down, but this is not always the case.

Don’t sign any agreements or contracts without having a lawyer and accountant look over them first.

Do assess the franchisor’s business and marketing plan as it will give clues about the level of franchisee support you’ll receive.

Do make sure you have significant market protection and that your franchisor and other franchisees don’t unduly compete with you.

Small business is BIG BUSINESS at the 2012 Black Enterprise Entrepreneurs Conference + Expo hosted by Nationwide, May 23-26, at the Hilton Chicago Hotel in Chicago, IL. Expect innovative sessions, high-powered speakers, and an early peek at the products, trends, and services you’ll need to stay ahead of the curve. Beat the March 16 Early Bird deadline to get a $200 registration discount at www.blackenterprise.com/ec/! And be sure to nominate your company or another business for our Small Business Awards! Want to pitch your business idea and win $10,000? Don’t miss the chance to enter our Elevator Pitch Competition before March 30 to qualify for the $10,000 grand prize. To register and find out more, visit www.blackenterprise.com/ec/

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