Franchising
Franchising gives entrepreneurs the opportunity to own a business with a proven model, established brand recognition, and built‑in support systems. Instead of starting from scratch, you’re stepping into a business that has already been tested, refined, and replicated—greatly reducing the risks that come with opening a new venture. For many owners, franchising offers a balance of independence and guidance, allowing them to focus on running the business while the franchisor provides training, marketing, operational systems, and ongoing support.
Before You Buy
Self-assessment & research
- Evaluate your interests, skills, financial capacity, risk tolerance, and lifestyle goals to identify franchise options that align with you
- Analyze market demand in your area and competition to ensure your chosen franchise has potential in the local economy
Review the Franchise Disclosure Document (FDD)
- Carefully study the FDD, which lays out initial fees, ongoing costs, franchisor background, legal issues, financials, and performance data (especially Items 7 & 19)
Speak with current and former franchisees
- Gain realistic insight into day-to-day operations, support quality, challenges, and income expectations by talking to multiple franchisees
Financial planning & budgeting
- Identify all costs—franchise fee, build-out, equipment, working capital, marketing, and ongoing royalties
- Explore funding options like SBA loans, franchisor financing, equipment financing, or personal savings
During the Purchase
Conduct thorough due diligence
- Review the FDD thoroughly, understand the franchise agreement, and verify disclosures in areas like litigation, termination rights, and franchisor obligations
- Consult franchise attorneys and accountants to analyze legal terms and financial viability
Sign franchise agreements & comply with legal requirements
- Ensure compliance with California’s Franchise Investment Law: franchisors must register the FDD with the state and provide it at least 14 days before signing
- Understand franchisee protections under California law (e.g., notice periods and fair termination under the Franchise Relations Act)
Attend training & setup operations
- Take advantage of franchisor onboarding, training sessions, and opening support to prepare operations and staffing
- Follow the franchisor’s operational systems, brand standards, and opening procedures carefully.
After You Buy
Follow franchisor systems & maintain brand standards
- Implement the training, marketing, and operational systems provided by the franchisor to maintain consistency and compliance
Leverage ongoing support
- Utilize marketing programs, operational assistance, peer groups, and ongoing training from the franchisor
Monitor performance & adapt
- Use the franchise’s reporting systems to track financials, benchmarks, and customer metrics. Address issues proactively.
- Maintain regular communication with the franchisor and participate in regional meetings and peer groups for support.
Who to call first?
If you’re brand new to franchising, your ideal sequence looks like this:
Valley Sierra SBDC
Learn the basics, review your financial readiness, and get help narrowing your franchise options
Franchise Experienced Attorney
When you have an FDD or franchise agreement in hand, you’ll need legal review before signing anything. About the Franchise Investment Law - DFPI
CPA or Financial Advisor
They help you understand tax implications, revenue models, and whether the franchise makes financial sense
Franchisor’s Development Representative
Once you understand the business side, you’ll be ready for deeper conversations about territory, fees, and commitments