Veterans: Be Cautious When Pursuing a Franchise Opportunity

A number of franchisors are offering financial concessions to veterans interested in purchasing a franchise. Veterans need to look before they leap.

As returning U.S. veterans continue to face a weak job market the opportunity to purchase and operate a franchise is an attractive option.  In order to facilitate this option, numerous franchisors have constructed special programs for veterans. These programs can include a reduced franchise fee, waiving the entire fee or reducing royalty payments for the first year. If you’re a veteran with a desire to invest in a franchise, avoid getting caught up in the hype and take a cautious approach.  

If your intent is to purchase a franchise here is some advice:

  • You’ll be exposed to franchise opportunities at franchise shows and job fairs. Take a conservative approach and don’t jump at the first opportunity.
  • Learn about franchising by visiting the FTC, AAFD and IFA websites. There is a wealth of information available on the Internet. I offer a digital version of my book The Franchise Buyers Manual to veterans for free. E-mail franchiseknowhow@gmail.com  if you’re interested.
  • Identify your financial resources and don’t risk it all. Although a franchise can minimize the risk compared to a new business start-up, franchisees do fail.
  • Although you’ll receive financial concessions, don’t let that change how much you’ll invest in a franchise. Just because you may pay a reduced franchise fee, you’ll still need to invest additional capital.
  • Be sure to follow a franchise process when you start your franchise search. Don’t cut corners and be sure to speak with existing and former franchisees from the franchises you are evaluating.
  • Operating a franchise business will be less structured compared to the environment in the military. Be sure to consider the transition.
  • Consider working a few days at a franchise you’re interested in so that you can gain a sense of how the business functions. Many franchisors might be willing to provide this concession.
  • Engage the services of an attorney with franchising experience. You’ll be investing your hard earned money and you’ll want to have professional advice.

If you’re a veteran with an interest in franchising, make sure that you proceed cautiously and follow the advice of a qualified attorney before purchasing a franchise.

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Comments

Vets

Ed; Thank you for providing your sage advise to veterans considering franchises. Can you please send me your guide ( OriginalVetInBiz@yahoo.com ) Thanks, Bill Elmore

Ed, Thanks for a timely and

Ed, Thanks for a timely and informative article. The programs you mention are a testimonial to the good intentions of some of the more reputable franchisors and franchisor groups like the IFA. And certainly every benefit that's conferred on our returning veterans should be applauded.  My only concern is that when anything is made easier or more accessible it's easier to let your guard down. So, veterans maybe need to exercise more caution than most. I think that's the point you already make pretty well.

By the way, I'd add to your bullets engaging the services of a CPA as well.

Ed, Thanks for a timely and

Ed, Thanks for a timely and informative article. The programs you mention are a testimonial to the good intentions of some of the more reputable franchisors and franchisor groups like the IFA. And certainly every benefit that's conferred on our returning veterans should be applauded.  My only concern is that when anything is made easier or more accessible it's easier to let your guard down. So, veterans maybe need to exercise more caution than most. I think that's the point you already make pretty well.

By the way, I'd add to your bullets engaging the services of a CPA as well.

Thanks

Mike, thank you for your kind comments. Ed

Sheehan's "true colors" come shining thru

". . .more reputable franchisor groups like the IFA"?

Are you nuts?!! The IFA has repeatedly backed laws and systems that have routinely financially and emotionally ruined franchisees. They have fought the full disclosure of financial information, forced arbitration (a method of "fixing" the outcome of legal disputes) and have paid off government officials to make sure no legislative help would be in the offing for franchisees.

Sheehan, thank you for now clearly letting franchisees know exactly where you stand.

I hope prospective franchisees do their homework before thinking of engaging your services.

Veterans Franchies need to be aware of how franchise fraud works

Veterans Franchises - I am a victim of franchise fraud and franchise churning.

If you are a military veteran considering a Veterans franchise, keep in mind that a discount of a scam, is still a scam. A discount on fraud, is still a fraud.

The FTC - Federal Trade Commission "regulates" franchising, however, the FBI calls franchise churning a pyramid scheme (http://www.fbi.gov/scams-safety/fraud/)

I know first hand how it feels to be milked for everything I own as a part of the secret franchise "system". In trying to defend myself from franchise fraud, I learned that the FTC knows that franchise fraud is very prevalent in the franchise industry, and the FTC is not on the franchisees side.

The day I signed my franchise agreement, I was actually pre-signing my bankruptcy papers - by a few years. (http://buy-best-veterans-franchises-business-opportunities-law.com/fran…)

Before I signed my Franchise agreement, my franchisor had my franchise termination paperwork already prepared. (http://veteransfranchises.blogspot.com/)

the ups store

Above all.....STAY FAR AWAY FROM THE UPS STORE!!!!!!!!!! They are enticing vets to take over failed or failing locations.. Moreover, a brand new location will cost you 3 times as much and will fail much sooner. Beware vets, it's a scam. And thank you for your service to our country.

Thinking of buying a franchise?

Many franchise offer reasonable opportunities to their franchisees, but not all do. Buy wisely or you may lose more than your franchise fee. To see ho bad some franchises are and learn some of the issues to avoid visit http://www.cdicorp.info