Veterans: Be Cautious When Pursuing a Franchise Opportunity

by Ed Teixeira

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 franchisees you are evaluating.
• 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 would 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, as you get close to purchasing a franchise.

© 2011 FranchiseKnowHow, LLC

Ed Teixeira is the President of FranchiseKnowHow, LLC. He can be reached at franchiseknowhow@gmail.com