A Limited Liability Company (LLC) serves as a step just short of a corporation. It grants the company, rather than its owners and operators, the ability to take on loans and obligations, thereby assuming risks under the company's name and protecting the founders or subsequent owners.
Buying a franchise is a massive opportunity for those dreaming of owning a business. If you’re thinking of buying a franchise operation, you’re not alone.
Franchising in the United States accounts for more than 10 percent of all businesses operating in the country. Fast food restaurants such as McDonald’s and KFC account for the majority of these franchises, followed by gas stations/convenience stores and full-service restaurants.
The FTC recommends: (1) start by examining your own financial capabilities in light of the risks; (2) research and understand the marketplace of franchising, including the franchisor’s experience and the competition; and (3) assemble an informal panel of trusted advisors to help you make the decision.
When a franchisor is acquired by an investment banker or investment firm, several potential issues may arise for both the franchisor and the franchisees. Not all acquisitions lead to problems, but it's good to be aware of potential issues. Here are some concerns that may come up.
As in a lot of business methods, franchise myths seem to abound. Such myths harm both franchisors and franchisees.
Ultimately, the decision to start an independent business or buy a franchise will depend on your individual goals, skills, and resources.
Buying a franchise could be the best decision you ever make. But like with any major financial decision, there is much to consider before you make everything official.
Do you need to get out of a franchise agreement? Understand your agreement. Consult experienced franchise counsel.
