What is an FDD or Franchise Disclosure Document?

An FDD is a Franchise Disclosure Document. These documents are required by the Federal Government. The documents are in a standard format that is provided by the FTC.

The FDD documents are basically the information that the Franchise Company is required to provide to you before you are allowed to buy the franchise. They are required to "Disclose" certain information such as:

Corporate Officer information
Legal proceedings
Up front fees
Estimated investment totals
etc...

So in essence they are required to give you information so you can make an informed decision.

There is also a Disclosure Period that is a standard 14 days. This waiting period or cooling off period is used to make sure you know what you are getting yourself into before buying a Franchise.

Do your due diligence, read the documents and talk to existing franchise owners in the system you are interested in.

For more free information on Franchises, you can visit our main site: Open A Franchise

Here are a few industry sites:

FTC.gov

nassa.org