The Franchise Disclosure Document (FDD) Item 11 Explained
Manage episode 357066208 series 3316056
https://www.NextLevelFranchiseGroup.com
We are picking up where we left off before where we are reviewing the different items that are in the Franchise Disclosure Document (FDD). We've covered all the way up to Item 10 in our previous episode. So please go back and watch those if you get a chance. You'll learn a lot about Item 11 if you do that. We want to start with a disclaimer we are not attorneys, so you should seek professional legal advice in addition to what you're learning here today which is we are covering Item 11.
Item number 11 is a very, very, very important item because it really covers all of the fees that you would be paying as a franchisee to the franchisor to stay in good standing in that franchise. These fees are basically broken up into about five different pieces, and they're not one size fits all. Some franchise FDDs may have these, and some may not.
- So number one is the initial franchise fees, and we'll get into these in depth.
- Number two is royalties and advertising fees.
- Number three is training and support.
- Number four is a territory, which is very important obviously.
- Number five is other expenses.
This is a big one … Item 11 is probably the densest and most comprehensive item in the FDD. There's so much information, valuable information that you need to review to understand the numbers of what you're investing in.
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