Federal law requires registration of franchises offered to residents of different states. Federal law also requires that the seller disclose the background and experience of the business's key executives, the cost of starting and maintaining the business, and the responsibilities you and the seller will have to each other once you've bought. Even if they are not required to provide the disclosures, you may want that information anyway. Determine all restrictions. Find out all limitations that will be imposed on your business operations, including what and where you must buy and sell.
Franchises often involve rigid rules on sales, marketing, and quality control.
Find out your level of assistance. Get a detailed description of any and all help the company will provide, including training programs, site selection, and financial assistance. Ask a lawyer, accountant, or other business adviser to read any disclosure documents and proposed contracts. Learn the firm's litigation record. Ask for information on lawsuits and bankruptcy proceedings involving the firm's principal officers, directors, partners and management personnel.