Fdd Template: Fill & Download for Free

(I always include the question in the beginning, in case it gets merged or changed!)Is there a list of all franchises in the US?I am afraid I am going to have to give you a fairly short answer to this one; no there is not. The simple reason is no one even knows how many franchisors are in the U.S.In order to meet the definition of a franchise there simply has to be "an offer or contract in which..." [1][1][1][1]contains certain terms, like the rights to use a name granted to one party, the other receiving a fee, and operational assistance offered and/or brand standards required.So as an example (and I have seen this done many times), if small business owner Sarah downloads a free FDD template, fills in some blanks, and then hands it to her friend Jeff to look at because he wants to open the same type of business, Sarah just became a franchisor, and a franchise was created.I have heard (though I have not seen the source) that the IFA estimates, if you use this definition of a franchisor, that more than 90% of franchisors never sell a single franchise.If you want real, statistically valid numbers they are hard to come by. The 2016 US Census data gave us some good info on franchising as a model, like that fact that almost 3/4 of all restaurants in South Dakota are franchised[2][2][2][2], but I had to reach WAY back to 1994 to find an actual "official" count of 2,177 franchisors[3][3][3][3].Since the growth rate of franchising is reported at somewhere between 1.5-3.5%/year, if we did a straight extrapolation on that we using an average net growth of 2.5% per year, you would land on around 4,000 franchisors in the US in 2017. If I had to guess, I would say that number is accurate, ± 25%.So no, there is no list, there is no count, and the data is significantly lacking.Hope that helps!Michael A. PetersonAuthor of How and Why to Franchise Your Business, find it on Amazon, Google Books, or the Google Play StoreIf you find my answer helpful or informative, please upvote! If you find the subjects of franchising, small business, and entrepreneurship as fascinating as I do, feel free to follow me on Quora, LinkedIn, or FaceBook, or check out my company’s website, as I write about these subjects pretty much every day!Footnotes[1] Code of Federal Regulations[1] Code of Federal Regulations[1] Code of Federal Regulations[1] Code of Federal Regulations[2] Franchise Employment[2] Franchise Employment[2] Franchise Employment[2] Franchise Employment[3] Franchising Research: A Literature Review and Synthesis[3] Franchising Research: A Literature Review and Synthesis[3] Franchising Research: A Literature Review and Synthesis[3] Franchising Research: A Literature Review and Synthesis

Disclaimer: I work for a company that markets franchise opportunities and Kumon is currently a customer. That aside, here are a few pointers for anyone exploring any franchise opportunity.First, don’t listen to anyone who says “just don’t.” Owning any business is tough. That goes for a franchise business. While franchises come with a template, it doesn’t mean guaranteed success. Unfortunately many buy a franchise thinking that’s the case and are doomed to fail. The rest put in the hard work and follow the lead of the home office (franchisor) and thrive. The bottom line is, how many successful franchisees does a franchise company have? Kumon, for instance, shows over 1400 franchisees in ‘14, ‘15, and ‘16, according to their 3/30/17 FDD. Only 82 on average leave the system in those years. Those numbers tell me that there are a lot of successful franchisees.The most important part of any franchise system is the validation step, which is the process of talking with franchisees of the company you are exploring. Talk to as many as you can. Seek successful franchisees as well as those that may be struggling. Every franchise will have franchisees that are less than thrilled with their experience. Don’t let one or two of those conversations dictate your outlook. If you speak to one of these franchisees, dig. What was their prior work experience? Where exactly are their expectations not being met? What exactly are they unhappy with? Is it franchisor support? Then make sure to ask others what they think of franchise support. In fact, a good amount of prep needs to go into these conversations. Prepare a list of questions and prioritize them in case you don’t get to them all. There are a slew of resources online that will help you with prep questions. Franchise Gator will be publicizing one soon. The Educated Franchisee is a great resource that we often collaborate with. The Franchise King is another.Aside from the number of franchisees that leave the system, another item I find valuable when reviewing the FDD is the ratio of franchise fee revenue to royalty revenue. The franchise fees are one time payments, whereas royalties are collected monthly from franchisees. Strong royalty income is a great indicator of franchise health. Its what every franchise strives for. This information can be found in the financials, typically in the Appendix of the FDD. (This is different than the Item 19, which shows financial performance and will also be a great resource.) According to the same FDD I referenced, Kumon has generated over $130 million in royalty income in ‘14, ‘15, and ‘16. Compare that to the franchise fees collected, which are under $200k in each of those years. In other words, Kumon is not relying on those one time sales to support their business model. These numbers point to a stability that one should seek when finding a franchise system to join up with.These are some high level items in the whole conversation of finding the right franchise opportunity. Its a lengthy and in-depth process. But always remember that a concept may be right for you that wasn’t for someone else and vice versa. There is a fit out there for you. Start with what you are passionate about. If working with kids and having an impact in your community is what drives you, then you probably have the makings of a successful Kumon franchisee.

The initial costs for making the transition to a franchise are mostly administrative. An operations manual needs to be created if one does not already exist. In concert with the operations manual is development of a comprehensive training program (remember you are training franchise owners to manage and operate the business who, in turn, are responsible for training their employees). Other manuals and training aids may be required based on the type of business (if this is a retail business, a site selection manual, construction manual, signage manual and pre-opening guide would be required). A marketing manual is important and should include artwork and templates for the brand and specify how these materials are used in the marketplace.Now comes the fun part - the creation of a Franchise Disclosure Document (FDD) the fees for which include document preparation and filing fees. This document includes the offering, franchise agreement, all other agreements (i.e. use of web site, sub-lease agreement if the franchisor is renting space on behalf of the franchisee), and audited financial statements for the 3 years prior to the filing date (to be prepared by a CPA). The FDD is then sent to the FTC for filing; certain states require that the document be approved and registered in the state prior to being granted the right to sell franchises in those jurisdictions.Average costs range from $75,000 to $250,00 to complete this process. This does not include billing your time for managing the process.My suggestion is that before you decide to franchise call a franchise consultant like myself who has the knowledge to evaluate your business to determine if it is a good candidate for franchising. Not all businesses - and business owners - are suited for franchising. In many cases there are other distribution models which are more cost effective.Good Luck!