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Understanding the Financial Side of Franchising: What You Need to Know

The Franchise Consulting Company

Components of the Initial Franchise Investment: Franchise Fee: The franchise fee is typically the first major cost you’ll incur when purchasing a franchise. This fee grants you the right to use the franchisor’s brand, trademarks, and proprietary systems.

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The Complete Guide to Franchises

AllBusiness.com

In return, the franchisee pays an initial franchise fee and ongoing royalties. Note: The Federal Trade Commission (FTC), the nation's consumer protection agency, regulates franchising through the FTC Franchise Rule , which is designed to help you make an informed decision about investing in a franchise opportunity.

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The Top Mistakes First-Time Franchisees Make and How to Avoid Them

The Franchise Consulting Company

Underestimating the Financial Commitment Many first-time franchisees underestimate the financial commitment involved in owning a franchise. It's easy to focus on the initial franchise fee and overlook the ongoing expenses, as well as the initial working capital required to get the business up and running.