Earnings Claims

By law, your franchisor must provide you with all the information about earnings claimed. This includes all material assumptions involved in the preparation and presentation of their franchise. These assumptions must be based on actual results of existing outlets and a percentage of the outlets which exceed or simply meet the portrayed results must be provided. Earning claims information must be prepared for you well in advance of your being presented any contract or agreement on behalf of the franchise. These documents should also provide you with a location where you can find additional substantiating evidence and information. All franchisees may and are encouraged to use this information for their own inspection. If any information on the claims is only relevant to a franchisor-operated outlet, this must be clearly stated in the documents. The results may vary with a franchisee-operated outlet. Earnings claims allow the franchisee to ascertain which specific level or range of sales, costs, income and profit can be expected for a franchise.