When entrepreneurs decide to start a franchising business, one of the most important documents they will get is the UFOC. This is a document that needs to be handled with extreme attention, as it states important information regarding both the franchisor and the franchisee. Checking it with a consulting company is a great idea, as they can emphasize certain aspects. The UFOC is also known as the Uniform Franchise Offering Circular. This is one of the first documents a possible franchisee sees and it includes both the franchisor and the franchisee's obligations and any fees that have to be paid. As a franchisee, any entrepreneur has to thoroughly read and analyze the UFOC.



When obtaining a franchise, the franchisor may have rules pertaining to the operation and other things they feel may be detrimental to that franchise. Read the contract of any franchise(s) you may be interested in obtaining, as well as the UFOC. A consulting attorney would be a good idea to make sure you understand all that "small print".

Unfortunately one can easily find much litigation between the franchise agreement parties. The main reasons are that either one of the parties is convinced the other is not doing whatever the agreement states; or when one party thinks the other one is acting in a manner that is injurious to the business. These two examples illustrate why the correct understanding of the UFOC is so emphasized.

When choosing a consulting firm, please have in mind that both daily and hourly rates charged by the top management consulting firms on the different levels (consultant, project manager, partner etc.) depend on the circumstances; if you do decide to choose such a firm be prepared to pay anywhere from $100 to 500$ per hour.

However, even at this stage you may find yourself dealing with a problem. If the consulting company has quoted you a price for a service, and you send in the documentation required from your side to get the job done, and then you pull out of it (mainly because you may have changed your mind) - the consulting company could insist on you paying them the full price they would have charged you for the whole job. That is why you should re ? read the service agreement that you signed very carefully to see what it says about termination clauses and liquidated damages.

If an important sum of money is involved, it is strongly recommended that you consult with an attorney in your local area. More than likely, you should be able to negotiate a pro-rated compromise that makes both parties feel "whole". For example, if the consulting firm budgeted the project based on 100 hours and the firm has only incurred 10 hours of time to date, a 10% settlement is probably reasonable, assuming the time can be reasonably documented.