Chances are, if you're a savvy entrepreneur instead of starting your own independent business you've thought of buying a franchise. There are many elements you will have to look into when buying a franchise. The first thing you should do is evaluate the master franchiser to insure that they will deliver what they are contracted to do. The second thing you should do is look into the business model of the franchiser. Does their company have a successful business model? Can you replicate this concept? Once you are sure you are ready to buy a franchise and have a way of reproducing this great business plan you will have to deal with the numerous technical and legal aspects. There are useful websites that should give you guidance on buying a franchise in Canada, but it is likely then you will need the help of experts and legal advice may well be a prerequisite. Who are the experts you need to turn to for advice?
Experts exist who specialize in buying a franchise who will be able to guide you through each step of the process.
When buying a franchise in Canada you will indubitably require the aid of a lawyer who specializes in the legal details. An attorney can assist you with your franchise agreement and disclosure documents. Why is this so necessary? An excellent relationship between the franchisor and franchisee is vital for the long term success of both parties and the basis of this is lucid legal documentation. Buying a franchise involves establishing a business relationship for years, hence you must be fully in tune with all the details of the franchise program. This requires a clear understanding of the many legal documents that will be involved, which can be challenging. The local and national laws of Canada require two main legal documents in order for you to buy a franchise. The disclosure document (the FDD) gives prospective franchisees information about the franchisor, the franchise system and the agreements they will need to sign so that they can make an informed decision. The FDD provides details such as financial disclosure, territory rights, fees involved in running the franchise and more. 14 states in Canada require franchisors to register their FDDs with the state or to notify them that they will offer franchises before they begin to conduct any franchising activity in the state. A lawyer specializing in franchising can help you comprehend legal issues as well as ensuring you avoid costly mistakes.
You will also need to have a franchise agreement drawn up which provides specific details about the terms of the franchise purchase. This document includes rights and obligations of both parties: standards, procedures and more. You must review the franchise agreement carefully with a qualified attorney.
Hiring a financial expert can assist you in buying your franchise in many ways. Above all, an accountant will be able to aid you with the development of a financial model that ensures you have optimal cash flow projections and have an excellent royalty structure in place. An accountant can help you crunch the numbers to ensure the projected revenues entail a profit for your franchisees and a royalty for you.
A virtual assistantBuying a franchise is not easy and takes a lot of time, money, organisation and research. By delegating certain tasks to a virtual assistant that are too time-consuming for you, it may free up your schedule to focus on those that matter.