QUESTION: "What are the basic legal areas I should know about in buying a franchise?"
Well, here's my two cents worth. When I think of legalities, I think of the following quote coming from the mouth of the franchisor trying to sell me.
"All the things I really like to do are either illegal, immoral, or fattening." - Alexander Woollcott
That's probably not the case but it keeps me on my toes when I think that whoever is selling me such an expensive product is trying his hardest to pry my money out of my hands. Fortunately, there are certain regulations, industry norms and advisors that help those of us buyers who probably won't really have the scoop on the franchise until well after we've bought the shop. These are the things that I would pay attention to on legal issues.
That's my checklist. Read the book Franchising for Dummies to get a better handle on this and hire someone that really knows about the legalities -- a franchise attorney. Try not to look like you're made of money when you see these attorneys. I have known one or two to polish their scare stories in front of a client to make an additional buck or two. Look poor -- dressed in sack cloth and ashes -- in the hopes that their rate will go down out of pity. Nonetheless, a good attorney is a worthwhile investment, considering you are looking at plunking down tens to hundreds of thousands of dollars in starting your franchise.
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