ten Approaches to Finance a Franchise in a Tough Economic climate

The Franchise Disclosure Document (FDD) - An Overview

If you're serious about buying a franchise, at some point you're going to receive and review a Franchise Disclosure Document (FDD).

- The management structure and history of the franchise

- Financial performance (If the franchise elected to provide)

- The Franchise Agreement

Each item provides specific details on the franchise opportunity.

Item 1.

Item 2. Identity and Business Experience of Key Persons running the franchise.

Item 3.

Item 4. Bankruptcy History - Details of any bankruptcy history of the franchise

Item 5. Initial Fees - Franchise Fee and any other fees required when signing the agreement.

Item 6.

Item 7. Initial Investment: An Estimate of the initial investment to start the business

Item 8.

Item 9.

Item 10. Financing Arrangements - Details of franchise provided financing.

Item 11.

Item 12.

Item 13. Trademarks - Details on franchise trademarks.

Item 14.

Item 15.

Item 16.

Item 17.

Item 18.

Item 19. List of Franchise Outlets - Number of current franchise locations as well as the number who have entered or left the franchise.

Financial Statements of Franchisor

Contract - The Franchise Agreement

Will the franchise work in your market? Is the business viable? I recommend speaking with a qualified franchise attorney, CPA and Financial Advisor.

Understanding a Franchise Disclosure Document

Commercial Bank Loan A way to finance your business is to take out a bank loan for part of the cost. Franchisor Also, there are some franchise companies who will loan money to their franchisees for a franchise purchase, often at a low interest rate. If your business becomes profitable, your retirement account will also increase. SBA loan The United States Government is also a resource when looking for money to fund a business. The Small Business Administration (SBA) has programs available to help you with your franchise purchase.

A solid business plan and great credit history are important for anyone securing any type of loan. Venture Capital Venture capital is another way you may find financing for your business.