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Breaking The Mold

Full Disclosure

Don't even think about buying a franchise until checking out--and thoroughly comprehending--that hefty disclosure document, the Uniform Franchise Offering Circular (UFOC).

This weighty document must be given to prospective franchisees within 10 days after the first personal meeting, or 10 days before any agreement is signed or money changes hands (whichever is earlier).

The UFOC describes the company; the investment; any litigation or bankruptcy history of the franchisor; the trademark, products and advertising program; your and the franchisor's contractual obligations; and more.

Using the UFOC's list of current and former franchisees, call a random sample of both types (don't rely on a few carefully selected names the franchisor gives you). Visit franchisees at their locations and find out what a typical day is like, how much money they make and whether the franchisor provides adequate support. You can even volunteer to work at a franchise for free for a few days to get a feel for the day-to-day life you'd live as a franchisee.

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This article was originally published in the April 1999 print edition of Entrepreneur with the headline: Breaking The Mold.

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