Buying a Franchise - Due Diligence

by a searcher

Nov 03,2022

Hello

There's a franchise i found that's SBA 7a Qualified that's only 10 minutes from where i live in Houston.

What are the due diligence items to keep in mind  that are different from a regular business purchase?

Does anybody have experience buying a franchise?  or running one?

Would like to connect with somebody that's done this before.

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professional from University of Minnesota - Twin Cities Campus

From a legal perspective, consider having an experienced franchise attorney review the FDD and accompanying legal docs. There is a local franchise litigation shop that does these for a flat fee and I would think other franchise-based firms would do the same.

Emphasis on flat fee! You don't want to pay an attorney hourly to read those novels!

These types of firms litigate with franchisors all day long so they are not deal attorneys (take their war stories with a grain of salt) but if there is room in the budget, I think this is money well spent. Feel free to DM me if you want a referral for the legal review. Good luck!

11/30/2022 | like reply | 0 likes

professional from Wayne State University

I recommend any potential franchisee read both books by Mark Siebert: Franchise Your Business and the Franchisee Handbook. While "Franchise your Business" is aimed at Franchisor's, it will give you a high level of appreciation of how a Franchisor will look at you as a franchisee.

11/10/2022 | like reply | 0 likes

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