Investing in a franchise can be a great opportunity for military veterans. Military veterans have an excellent transferable skill set that franchisors covet and is advantageous to successful franchise ownership. Because of these skills many franchise companies offer special incentives and discounts to veterans to help get them started in business. But keep in mind, great incentives don’t always equate to happy franchisees. What really matters is what happens after you buy your franchise—does the special attention and support you receive before you buy actually carry over once you’re a franchisee?

There are two methods to how to buy a franchise; (1) you can go it alone or (2) you can work with a franchise broker.

Go it alone:

You do the research and due diligence on franchises opportunities that you’re interested. Having a good understanding of your personality, strengths and weaknesses, and business capabilities is essential in selecting a franchise that’s a good match for you. A franchise is a significant investment and due diligence is the key to mitigating as much risk as possible.

Here’s what you need to know before investing in a franchise:

• What is franchising?
• Pros & Cons of franchising
• Franchising vs. Independent Start Ups
• Is franchising for you? Self-Evaluation
• More than 70 different industries in franchising
• Selecting a franchise that’s right for you personally & financially
• How to research franchise opportunities
• Franchise financing – where to borrow money
• What to expect from a franchisor
• What a franchisor expects from franchisees
• Evaluating the franchisor’s operating system
• Understanding the fees involved in franchising
• Key questions to ask both franchisor and franchisees
• Sources of information that can help you evaluate opportunities
• Seeking out the right legal and accounting advice
• What is the Franchise Disclosure Document (FDD)
• How to read the items in the FDD
• How to use the FDD to your advantage
• Major topics covered by the FDD
• Evaluating the franchisor’s performance using the FDD
• Exploring options for negotiating the FDD with a franchisor
• Understanding the Franchise Agreement

Use a franchise broker:

A franchise broker can help sort through the plethora of franchise opportunities available and assist in narrowing down the opportunities based on your specific capabilities and requirements. A good and properly trained franchise broker can and will offer you a wealth of information making your franchise exploration a lot easier and less stressful. Here’s some things you should expect when working with a good professional broker:

Insider Information – Brokers meet and talk with franchisors every day. They know their history and culture and the profile of a ideal candidate for a particular franchise. This insider knowledge of the brand and the characteristics of a successful franchisee mitigates some of the financial risk for the potential franchisee.

Shorter Research Time – Search Google for “franchises opportunities” and you’ll get about 5,120,000 results. A good franchise broker knows how to narrow the search based on individual skills, financial capabilities, demographic information and other key information. This process can shave weeks off of the research process.

Ensure Proper Validation – Asking the right questions of the franchisor and franchisees is critical to successful due diligence and selecting the right franchise. You don’t know what you don’t know so working with someone who knows what questions to ask in validating a specific franchise opportunity is key in helping you go in with your eyes open.

Access to Legal and Accounting experts – The Franchise Disclosure Document and Franchise Agreement are legal contracts that define both the franchisees and franchisor obligations and govern the partnership between the franchisor and franchisee. While the documents are standardized and straight froward they are written by lawyers to protect the franchisor. Ensuring you understand all the legal aspects and clearing up any ambiguity before executing a contract ensures there are no misunderstandings prior to making a significant financial investment.

Negotiating Your Agreement – What’s negotiable and what’s not? A broker can help you understand what terms in a Franchise Agreement you may be able to successfully negotiate and act as an agent (middle man) to get considerations on your behalf. Knowing when to negotiate is also key in getting the deal you want.

There are good, not so good and unfortunately just plain bad franchise brokers in the franchise business. A good franchise broker can and will offer you a wealth of information, inside tips, guidance and understanding; making your franchise exploration a lot easier and less stressful.Here are three warning signs to look out for:

Brokers represent a fraction of franchises actually available. A lazy franchise broker may speak negatively of franchises not in his portfolio or will sometimes try to fit a square peg in a round hole.

If your franchise broker is trying to pressures you into making a quick decision, or intimates that you won’t be taken seriously unless you are ready to buy now run! Buying a franchise is a very big and very important decision and good franchise brokers respect this.
Anyone can be a franchise broker. You can spend a few thousand and join an organization, start calling franchises and ask to work as a broker for them –Voilà– you are a franchise broker. If you know more about franchising then your franchise broker — exit stage left as quickly as possible.

There is no right or wrong way to buy a franchise. It all boils down to due diligence. When giving seminars on franchising I often am asked, Why should someone use a broker? I answer this question with a couple of questions of my own.

If your going to court and you know that a mistake in procedure or law could cost you thousands of dollars, you seek out an attorney.
If you are investing a large sum of money in the stock market and want to mitigate risk and understand potential strategies, you seek out a financial adviser.

A franchise is a significant financial investment that carries with it legal obligations. It just makes good sense to seek out a good professional franchise advisor that knows how to buy a franchise which can save you time, offer you a wealth of information making your franchise exploration a lot easier and less stressful.

For more information on veterans and franchising please visit my blog:
http://www.veteranfranchiseadvisers.com/blog/