There are those that feel that the AAFD inadvertently may lure prospective franchisees to franchise systems that do not have proven business models.

SAN DIEGO (Blue MauMau) - The American Association of Franchisees and Dealers announced today that it has suspended its recognition of Cuppy’s Coffee and More, LLC as an AAFD Accredited Contract recipient, pending a determination of the Association’s Board of Directors that AAFD’s Accreditation of the Cuppy’s contract should be withdrawn.

I have read with great interest the debate about the effectiveness of the AAFD.  I have appreciated those comments that understand what we are trying to accomplish, and am frustrated by those detractors who are attacking an important initiative to promote fair and balanced franchise agreements that actually respect franchisee rights and interests.

Franchise Registration: What It Is, Who Requires It, and Its Limitations for a Franchise Investor

Editor's note: Robert Purvin, Chairman of the American Association of Franchisees and Dealers, defines franchise registration and its limitations to franchise investors.

Who Requires Franchise Registration

The Federal Trade Commission (FTC) and some fifteen states in America require franchisors to provide franchise buyers with a pre-sale franchise disclosure document. The stated purpose of pre-sale disclosure is to provide prospective investors with material information necessary to determine the viability of an offered franchise opportunity. Unfortunately, too often franchise disclosure documents are effectively used to insulate franchisors from oral disclosures that may have been made, or from the failure of a prospective franchisee to perform full due diligence of a deficient opportunity.