Thinking about a franchise to supplement that retirement income, or simply breaking out into a business of your own?
Watch out for false claims about earning big bucks with very little effort, says Jodie Bernstein at the Federal Trade Commission. Prudence and due diligence is the rule, she says. Possible investors should:
--Investigate all earnings claims. Talk to others who have purchased the opportunity to see if their experience verifies the claims. Demand to see the company's basis for its claims in writing. Be skeptical in judging whether the claims are backed up.
--Beware of "shills" or phony references. Don't accept a list of references selected by the company offering the business opportunity as a substitute for a complete list of franchise or business opportunity owners.
--Ask for the disclosure document if you're investing in a franchise. This document, required by law, should provide detailed information to help you compare one business to another. If the company has no disclosure document, beware!
