Is this is a stable franchise? Is it safe to buy? This is an example of regulations working in your favor. When you are looking for a franchise to buy, one of the great things provided to you is a Franchise Disclosure Document or FDD. The FDD is a document that discloses the Franchise’s history. It is an extensive document that equips a new buyer of a franchise with full details as to what they are about to purchase.
Inside the FDD, the Franchises entire financial picture is disclosed. You will find pages and pages of their financial records. This may seem a little boring at first glance, but it is fascinating to see, when you know what to look for. You can determine if they are in a lot of debt, their spending habits, their cash flow, royalties they earn, if they are growing or shrinking and so much more. This is the document that gives the best indication of if it is a stable franchise.
When you know this, it is easy to quickly choose systems that are doing well. Stability in the brand and their finances makes the difference to your ability to be supported by the system and your ability to earn revenue. Contact us today to learn more about what franchises show strong financial statements!