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People's Law Guide

 

Franchise Risks

by Stephen M. Feidelman, Esq.
Website

07/25/08

 

One should fully read the franchise disclosure document to identify relative risks in the total transaction. Put in other words, what are the promises which are being made in return for your agreement to pay the initial and ongoing franchise fees, and what are the risks of those promises falling short of your expectations or their being broken? What obligations are you being asked to undertake, and how dependent are you upon achieving a perceived business goal in order to meet those obligations? To be sure, no business is risk-free. However, the franchise purchaser should remember that he or she is agreeing to pay significant sums of money for something. You should endeavor to determine what that “something” is, both as to perceived value and reasonable expectations.

Stephen M. Feidelman maintains a general civil law practice in Hollywood, Florida, with a core concentration on franchise and dealership representation and allied business law issues. He has attained a Martindale-Hubbell Peer Review rating of AV®, which depicts that a lawyer is recognized for the highest levels of skill and integrity; has served on the Executive Council of The Florida Bar Business Law Section; chaired The Florida Bar's Antitrust, Franchise and Trade Regulation Law Committee; been a faculty participant in numerous seminars related to franchise and business opportunity legal issues; contributed to Florida Bar committee consumer education pamphlets and seminar course materials; and been a guest lecturer on franchise law issues at the H. Wayne Huizenga School of Business and Entrepreneurship, Nova Southeastern University.

 

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