In this article published by Entrepreneur, iFranchise Group CEO Mark Siebert discusses how financial performance representations (FPR’s) can be a valuable, but not the only tool, to leverage in the franchise sales process.
In fact, Siebert maintains that while FPR’s provide comfort to a prospective franchisee making a decision to invest in a franchise brand, and are therefore recommended for many franchisors, they are not necessary to sell a franchise.
Siebert begins by defining the the FPR as included in Item 19 of a Franchise Disclosure Document (FDD) and reviewing its history and uses. He also discusses the challenges of developing accurate FPR’s in the wake of the tumultuous year that was 2020. And, more important, he describes the key elements that will ultimately help franchisors sell more franchises.
He concludes by recommending that franchisors not curtail their franchise sales efforts nor sit on the sidelines and wait to develop the perfect FPR, noting that doing so may cause them to miss out on one of the strongest years ever for franchise sales.