#RVABizLaw Tip of the Day: Getting Free Copies of Franchise Disclosure Documents

Ever thought of investing in a franchised business?  Thousands of franchise systems representing virtually every conceivable type of business are actively searching for qualified franchisees 24/7.  How does one learn more about franchise opportunities and what they have to offer?  A few hours of online research will yield a wealth of information, and a great way to learn a lot about a specific franchise is to read its Franchise Disclosure Document (also known as an “FDD”).  The FDD is a required disclosure document that franchisors are required to provide to prospects at least two weeks before they can purchase.  There are several ways to obtain copies of FDDs as part of your research.  One way is to request a copy directly from the franchisor.  This often requires some effort and puts you in line for sales calls from the franchisor’s sales and marketing team.  A second way is to purchase a copy of an FDD from one of the numerous companies that offer a wide collection of FDDs for sale, typically in the range of $99-$199.  The third, and arguably best method, is to download a free copy.  The states of Wisconsin, California, and Minnesota are among about a dozen states that require franchisors to successfully navigate a detailed registration process before being allowed to offer or sell franchises in their state.  As part of the registration process, these three states post filed FDDs online and make them publicly available to the public.    So when you are researching a particular franchise opportunity, check out these websites  https://www.wdfi.org/apps/FranchiseEFiling/default.aspx; https://www.cards.commerce.state.mn.us/CARDS/; and  https://docqnet.dbo.ca.gov/ to see if the franchise is registered in that state and, if so, you can view or download a copy of the franchisor’s most recent FDD at no charge.

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