It’s frustrating. A Franchise Disclosure Document is extremely important to read. And equally as boring. This document and the Franchise Agreement set out the complete terms under which you become a franchisee. You might have great conversations with the franchise representative. You might get to know, like, and trust him. But what matters is what’s in writing. If you are considering buying a franchise, you will need to get comfortable with this entire, legal-ease filled document. Let’s start with a description: What exactly is the Franchise Disclosure Document? In the United States, franchises are all regulated by the Federal Trade Commission (FTC). One of the regulations requires every franchise to publish a Franchise Disclosure Document (FDD) every year. Every year the document must be updated with current information. The FTC dictates what information must be included in the FDD. The FTC actually writes the table of contents. They ensure that each franchise company provides the same kinds of information, usually called “items.” There are 23 sections in the FDD. Let’s review of some of the most crucial parts. There will be information on the senior managers of the company. That is something you would want to know. Has there been an ownership change? If so, do the new owners have a background in the industry? Have the owners ever filed bankruptcy? This is the kind of information that will be included on the ownership, in items number one, two, and four. Has this company ever had a major law suit? If so, it will be detailed in the FDD. We all know even the most ethical company can be taken to court in The United States these days. So a single lawsuit might not be a reason to worry. But some franchise companies have literally dozens of suits between them and the individual franchisees. If you see that kind of litigation history you know you could be in for big trouble after joining that franchise. That’s a reason to pay attention to item number three – Litigation. You know you have to make an investment in order to start a franchise, but how much? That’s also in the FDD. The company will give you ranges for every start-up cost that franchisees typically experience: rent and advertising and construction. They’ll tell you how much cash you should have on hand in order to cover your costs after you open. Look at items number five, six, and seven for this information. Most people know that a McDonald’s franchisee must purchase all of their food products directly from the franchiser. Does your franchise have a rule like this? You can find out in items 8 and 16. Some franchises give you a protected territory, while others do not. Neither of these is necessarily “better,” but you’ll want to read item 12 to understand how the territory works in the franchise you are considering. Item 19 is the one that is most often talked about. This is the only optional part of the FDD. In this section, the franchisor is permitted to share the financial results that existing franchisees have. This is obviously important information to have. Unfortunately, only about one-third of franchisors provide this. But don’t worry – if yours does not, there is still a way to get this information. The last item we will mention is usually cited as the most valuable. In Item 20 the franchisor must show you how many franchises they have, as well as how many have opened and closed for the past two years. What’s better is that they also have to provide phone numbers for every last franchisee. Why is this so valuable? Because those franchisees are your best source of information on the business. You can pick up the phone and call as many of the existing franchisees as you like. Whatever you want to know about the business, you can ask them. The existing franchisees will give you an inside look into exactly what it’s like to own this franchise. We find they usually give it to you straight – warts and all. And after all, no one is in a better position to tell you what the business is really like than the people who are working in the business every day. So, yes, the FDD is boring reading. There is data and figures and statistics and charts. All the things that might make your eyes glaze over. But look hard at that document. It is the key to learning just how good of an opportunity that franchise really is.
January 20, 2022
Maybe you like your job, but you’re just not where you want to be financially. What do you do? Apply for a position with a different company? Or approach your boss and ask for a salary increase?
The ability to negotiate a salary increase can place you in a better financial position: extra money can help you qualify for mortgage loans or refinancing, or if you’re trying to build a rainy day fund, a raise can jump-start these efforts. However, it’s important to research and know your value before approaching your boss.
In other words, you can only approach the conversation with a fair number in mind—based on the average salary for professionals in your industry with your experience and skill set. Of course, it isn’t enough to only research your value. You need to know the best ways to approach your boss.
Here are four things you should never say when asking for a raise:
1. Don’t Threaten To Quit
Some employees think they can get the upper hand by threatening to quit their job. However, this isn’t recommended, even if you’re prepared to follow through with the threat. Remember, the goal is to get on your manager’s good side, not tick them off. If you approach the meeting with an abrupt or aggressive attitude, your boss may not respond favorably—they may actually call your bluff!
A better approach is to explain how much you enjoy your work. Let your boss know that you're interested in growing with the company. Next, state your argument for a salary increase. Be professional and keep your negotiations brief.
2. Don’t Mention A Co-Worker’s Salary
If you learn that a co-worker in a similar position earns more than you, don’t mention this when speaking with your boss. There may be valid reasons why your co-worker earns more. Maybe they have an advanced degree, or maybe they took additional courses to improve their skill set. Then again, maybe they have more experience than you. Don’t immediately assume that your employer is giving you the short end of the stick.
Rather than bring up a co-worker's salary, you could say:
"I've been researching the going rate for this position, and the average salary for workers with my education and experience is _____. I feel that I've been doing a great job and would like to discuss increasing my salary."
3. Don't Choose The Wrong Time
Don’t ask your boss for a raise out of the blue, and you certainly shouldn’t ask during a meeting on an unrelated topic. Once you’ve completed your research, schedule an appointment to meet with your boss privately. Additionally, prepare for this meeting by practicing responses. In all likelihood, your boss will question why you want a salary increase. The way you answer this question can determine the outcome.
Prior to this meeting, compile a list of all your accomplishments during the last 12 months. When your boss questions your reasons, be ready to run down this list and mention any other selling points. For example, you can mention any classes you've recently taken, and if it's been years since your last raise, bring this to your manager's attention.
4. Don’t Whine About Your Personal Problems
Do you have debt? Do you need to complete repairs around your house? Was your spouse laid off? These are all valid reasons to negotiate a salary increase. Understand, however, that your personal problems are not your manager’s problems. They no doubt will empathize or sympathize with your situation, but you shouldn’t expect them to automatically fix your problems by increasing your salary. Not that you shouldn’t ask for a higher salary, but keep the focus on your performance.
You could say:
"In the past ___ months I've taken on several new responsibilities (list them), and I know that you were satisfied with many of my suggestions and changes."
Getting paid your worth can improve job satisfaction. And if you’re already completing assignments outside your job description, why not take a chance and approach your boss? They just might comply with your request. Just remember to avoid making these four mistakes when asking for the raise you deserve!
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This article was originally published at an earlier date.
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