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    What Information Is Found in The FDD ? (FDD - Franchise Disclosure Document)

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    Glaiza Jayne Landero
    The Franchise Disclosure Document (FDD) contains 23 sections that provide important information for prospective franchisees. These sections include details about the franchisor's business experience, litigation history, initial and ongoing fees, the franchisee's financial investment and obligations, trademarks, and terms for renewal or termination. The FDD also contains audited financial statements, a list of existing franchises, and all agreements that the franchisee would be required to sign.

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    What Information Is Found in The FDD ? (FDD - Franchise Disclosure Document)

    Uploaded by

    Glaiza Jayne Landero
    61 views3 pages
    The Franchise Disclosure Document (FDD) contains 23 sections that provide important information for prospective franchisees. These sections include details about the franchisor's business experience, litigation history, initial and ongoing fees, the franchisee's financial investment and obligations, trademarks, and terms for renewal or termination. The FDD also contains audited financial statements, a list of existing franchises, and all agreements that the franchisee would be required to sign.

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    The Franchise Disclosure Document (FDD) contains 23 sections that provide important information for prospective franchisees. These sections include details about the franchisor's business experience, litigation history, initial and ongoing fees, the franchisee's financial investment and obligations, trademarks, and terms for renewal or termination. The FDD also contains audited financial statements, a list of existing franchises, and all agreements that the franchisee would be required to sign.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    61 views3 pages

    What Information Is Found in The FDD ? (FDD - Franchise Disclosure Document)

    Uploaded by

    Glaiza Jayne Landero
    The Franchise Disclosure Document (FDD) contains 23 sections that provide important information for prospective franchisees. These sections include details about the franchisor's business experience, litigation history, initial and ongoing fees, the franchisee's financial investment and obligations, trademarks, and terms for renewal or termination. The FDD also contains audited financial statements, a list of existing franchises, and all agreements that the franchisee would be required to sign.

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    WHAT INFORMATION IS FOUND IN THE FDD ?

    (FDD - Franchise Disclosure Document)

    1. The franchisor and any parents, predecessors and affiliates. This section
    provides a description of the company and its history.

    2. Business experience. This section provides biographical and professional


    information about the franchisors and its officers, directors and executives.

    3. Litigation. This section provides relevant current and past criminal and civil
    litigation for the franchisor and its management.

    4. Bankruptcy. This section provides information about the franchisor and any
    management who have gone through a bankruptcy.

    5. Initial fees. This section provides information about the initial fees and the
    range and factors that determine the amount of the fees.

    6. Other fees. This item provides a description of all other recurring fees or
    payments that must be made.

    7. Initial investment. This item is presented in table format and includes all
    the expenditures required by the franchisee to make to establish the franchise.
    8. Restriction on sources of products and services. This section
    includes the restrictions that franchisor has established regarding the source
    of products or services.

    9. Franchisee’s obligations. This item provides a reference table that


    indicates where in the franchise agreement franchisees can find the
    obligations they have agreed to.

    10. Financing. This item describes the terms and conditions of any financing
    arrangements offered by the franchisor.

    11. Franchisor’s Assistance, Advertising, Computer Systems and


    Training. This section describes the services that the franchisor will provide
    to the franchisee.

    12. Territory. This section provides the description of any exclusive territory and
    whether territories will be modified.

    13. Trademarks. This section provides information about the franchisor’s


    trademarks, service marks and trade names.

    14. Patents, copyrights and proprietary information. This section gives


    information about how the patents and copyrights can be used by the
    franchisee.

    15. Obligation to participate in the actual operation of the franchise


    business. This section describes the obligation of the franchisee to
    participate in the actual operation of the business.
    16. Restrictions on what the franchisee may sell. This sections deals with
    any restrictions on the goods and services that the franchisee may offer its
    customers.

    17. Renewal, termination, transfer and dispute resolution. This section


    tells you when and whether your franchise can be renewed or terminated and
    what your rights and restrictions are when you have disagreements with your
    franchisor.

    18. Public Figures. If the franchisor uses public figures (celebrities or public
    persons), the amount the person is paid is revealed in this section.

    19. Financial Performance Representations. Here the franchisor is allowed,


    but not required, to provide information on unit financial performance.

    20. Outlets and Franchisee Information. This section provides locations and
    contact information of existing franchises.

    21. Financial statements. Audited financial statements for the past three years
    are included in this section.

    22. Contracts. This item provides of all the agreements that the franchisee will
    be required to sign.

    23. Receipts. Prospective franchisees are required to sign a receipt that they
    received the FDD.

    Source: The IFA Educational Foundation

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