Avoiding Fraud When Buying a Franchise

If you are considering the purchase of a franchise chances are you have conducted a number of web searches, filled out some web contact forms, made calls and have spoken with franchise sales representatives.  Along with the many rewards and opportunities presented with entrepreneurship and "owning your own business" comes significant risk.  Accordingly, before signing a franchise agreement or paying any franchise fee a detailed due diligence evaluation is critical.  As I have mentioned in many of my posts and articles one of the most critical "due diligence" tasks includes the simple (but critically important) step of contacting and speaking with existing franchisees.

This afternoon I came across a website maintained by a "former" franchisee of a "Java's Brewin" franchise.  While I am not familiar with Java's Brewin, the former franchisee raises troubling allegations of fraud by the franchisor and the franchisor's principal.  While the vast majority of franchisors are honest and reputable, be aware that, sometimes, the franchise opportunity presented to you may be vastly different from what it appears to be , i.e., the factual information presented to you (to induce you to buy a franchise) may be inaccurate or the product of fraud.

Take a look at some of the comments by the former Java's Brewin franchisee and understand that when buying a franchise, take your time, consult with an experienced franchise lawyer, contact existing franchisees and leave no stone unturned.