Presidential Secrets

Getting Started

"Let no feeling of discouragement prey upon you, and in the end you are sure to succeed." -Lincoln.
Now that your goals are in sharp focus, it's time to begin the process of gathering information about franchise programs that meet your criteria. Look through magazine ads and attend one of the frequent franchise and business opportunity trade shows that travel the land. Contact franchisors and express interest in their programs.

The first response of the franchisor will be to send you an application package that helps them determine your financial and business experience qualifications. Be prepared to reply to a request for your personal financial statement, recent work experience, references and interests. Most of this information can be prepared in advance, to be attached to the application forms as they arrive. Your prompt and complete response will take your application to the next level.

"Speak softly and carry a big stick." -Roosevelt.
Your big stick in conversations with franchisors is the fact that you're an interested, qualified prospect. Franchisors spend huge sums of money finding prospects like you, and if the sales team is well trained, they won't let you get away easily. Show the franchisor by your educated questions that you're seriously interested in their program.

"Let your countenance be pleasant, but in serious matters, let it be somewhat grave." -George Washington.
Your objective in these preliminary conversations is to get a feeling for the program, to learn where the company is planning to expand and what type of owners have had success owning one of these franchises.

Your secondary objective is to receive a copy of the company's Uniform Franchise Offering Circular. Federal law and laws in more than a dozen states require this UFOC document to be delivered to a prospective franchisee. That doesn't mean you can call up a franchisor on a preliminary inquiry and force them to send you a copy of their UFOC. The law mandates delivery only after you sit down with a franchisor representative for a detailed discussion about the program (this doesn't include routine conversations across a trade show booth or a chance meeting on an airplane), or at least 10 business days before you close on your purchase and pay the franchise fee.

These documents are a bit expensive to send out in bulk, so franchisors are generally conservative about who receives one. Giddy inquiries written in crayon aren't likely to receive a disclosure document on request. You certainly improve your chances of receiving a UFOC if you present yourself as a serious candidate, if not a person of grave countenance.

You should also realize the franchisor may not be authorized to engage in franchise sales activity in your state. If you live in one of the 14 registration states (California, Hawaii, Illinois, Indiana, Maryland, Michigan, Minnesota, New York, North Dakota, Rhode Island, South Dakota, Virginia, Washington and Wisconsin), the franchisor must register with state authorities annually before it can sell to you. If it chooses not to register in your state, the company is prohibited from even talking to you about the program. Contact the attorney general's office in one of these states to check on a company's registration status.

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This article was originally published in the January 2001 print edition of Entrepreneur with the headline: Presidential Secrets.

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