Franchise Disclosure Document (FDD)

By Joe-Willson on 2010-06-19 16:20:37

The franchise disclosure document FDD, formally known as Uniform Franchise Offering Circular (UFOC), is an obligatory document every franchisor must have in place before launching their business. The purpose of the FDD is to provide potential franchisees with information about the franchisor. A typical franchise disclosure document (FDD) contains a set number of chapters (called items) as well as some exhibits and each part of this document must contain specific information.

Most franchisors find the preparation of their FDD the most difficult task. The real challenge of this task is in the fact that the document must strictly comply with the Federal franchise law as well as to specific state franchise laws and regulations.

What information is typically included in a franchise disclosure document FDD

Each franchise disclosure document must have a cover page that should be prepared in accordance to state requirements. It must be followed by a table of contents. There are regulations stating the way each item and exhibits must be named or numbered.

There are 23 items in the document and each item discloses information about different aspect of the franchise business. For example item 5, item 6 and item 7 provide potential franchisees with information about the initial investment requirements and your franchise fees, item 17 covers termination and renewal processes and item 21 is the franchisor financial statement.

As it is obvious, compiling all of this information is not an easy task, let alone putting it in the format required. In addition any franchise disclosure document FDD must be audited by an independent audit company prior to filing with the state.

How to get your franchise disclosure document (FDD) ready in no time

Although the whole task of preparing or renewing a franchise disclosure document FDD sounds quite complicated, it turn into a real piece of cake. The best way to simplify this task is to use a franchise disclosure document FDD template.

Franchise disclosure document templates (FDD templates) are ready, customizable documents prepared by expert franchise professionals and reviewed by franchise attorneys. They provide the frame of the document and every franchise owner can customize them to fit the specifics of their business. High quality FDD templates will also have easy to understand instructions to help through the customization process.

There are many franchise disclosure document FDD templates available, so finding one is just a matter of some research. One of the best templates can be found here. It is not only fully compliable with federal and state regulations but is also FTC certified. Moreover there is a free sample so you can give it a try before deciding to use it for your franchise business. Click here.

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