Franchisors usually say they are prohibited from giving it by FTC rules; really it is optional, but they do not say that. One must rely excessively on verbal information from existing franchisees who are not willing to divulge their personal finances to someone they hardly know.
U.S. Federal Trade Commission
September 26, 1997
Public Comment
Everett W. Knel
Request for public comment on possible revisions to The Franchise Rule.
Comment #109
From: moc.loa|llenKWE#moc.loa|llenKWE
To: HQ.HQ02(FRANPR)
Date: 9/26/97 2:25pm
Subject: 16 CFR Part 436 Comment
Franchisors should be required to provide financial performance data based on existing franchise in operation and the basis thereof in the UFOC document.
Alternately, it could be provided upon separate request subject to confidentiality and represented as accurate, but not necessarily a guaranteed projection of a potential franchisee's profitability with a disclaimer to the effect that depends on the potential franchisee's ability and location he or she picks. etc.
Having looked at a few franchise opportunities so far, this data is hard to obtain. Franchisors usually say they are prohibited from giving it by FTC rules; really it is optional, but they do not say that. One must rely excessively on verbal information from existing franchisees who are not willing to divulge their personal finances to someone they hardly know.
Everett W. Knel
For Review, see FTC “Table of Commenters”
http://www.ftc.gov/bcp/franchise/comments/tabcomm.htm
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Risks: F.T.C. Public Comments, United States, 1997, Due diligence, United States, 19970926 Comment 109
