What’s a UFOC?
The following guest post is from Franchise Direct.
Are you ready to buy into a franchise opportunity? If so, are you aware that you can avail of the Universal Franchise Offering Circular (UFOC), a legal document which gives you detailed information on any franchise opportunity operating within 15 US States?
This document is available from the Federal Trade Commission and will supply you with valuable information about:
- The company’s management structure, history and franchise experience
- Legal status and any litigation history, including past and pending cases
- Fee schedules for opening, operating and terminating the franchise.
- Details of any financial arrangements the franchisor will offer the franchisee.
- Any restrictions on products and services offered.
- Data on existing franchises, such as how many are currently operating, how many have been opened, close or transferred.
- Trademarks, patents, copyrights and other proprietary assets.
- Projected capital investment, required purchases, and any territorial protection rights.
- What is required of the franchisee in the relationship, and mutual expectations for both parties involved.
The UFOC is basically your starting point for finding out detailed legal and financial information about a franchisor and franchise opportunity, and also in negotiating the terms of the Franchise Agreement.
It should raise some questions and issues that must be addressed before signing the agreement. You should also contact a legal representative to help with legal terminology stated within the UFOC. This is necessary to understand fully the terms and conditions outlined in the Franchise Agreement.
If you would like further information relating to the UFOC or on any aspect relating to the franchise industry, check out Franchise Direct’s quality content Information Center for all your franchising industry related queries.
Steve Brodsky on January 20th, 2008 10:00 am
Interestingly, I have found that most potential franchisees don’t know that franchise agreements are often negotiable. Don’t just accept the franchisor’s assertion that the agreement is non-negotiable. Everything in life can be negotiated, even franchise agreements.
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