Franchise Legal Advice and Business Tax Advantages
Michael Rosenthal and John Quattrocchi help to explain the FDD and EBITDA terms
The Franchise Business Radio show is a platform to bring together franchise professionals to connect, educate, and collaborate to serve the franchise community and those considering franchise ownership. On a recent episode, guest Michael Rosenthal, a Franchise Attorney and Corporate Partner of Taylor English Duma law firm, provided legal advice and understanding of the Franchise Disclosure Document, and guest John Quattrocchi, owner of Corporate Financial Options and CPA, who specializes in working with franchises, provided insight on tax advantages.
Here are some brief excerpts of the interview between host Pamela Currie and guests, Michael Rosenthal and John Quattrocchi.
Currie: This an educational show for those that are considering franchise business ownership, and I want them to receive some legal insight from you. I’m going to start at a high level and then start to drill down with you. Let’s start with the acronym, FDD. Give us an overview of an FDD?
Rosenthal: First of all, the acronym stands for a Franchise Disclosure Document. The Federal Trade Commission regulates franchises in the sense that it requires this document, the FDD, to be given out 14 days before any prospect signs a franchise agreement. So, you have to have it in your hot little hands or on your desktop or laptop, and it’s got a ton of information that franchisors are required to put in the FDD. It’s everything from background about the company, its officers and directors, financial information, the company that’s selling you the franchise and estimated costs that you will incur as you start up your franchise, ongoing fees, information about the territory you may receive, their trademarks. It just goes on and on. It’s just a very useful document.
Currie: Welcome to our next guest: John Quattrocchi (CPA). Let’s talk about business ownership benefits–tax advantages. Should we start off with an acronym? EBITDA?
Quattrocchi: EBITDA, that’s Earnings Before Interest, Taxes, Depreciation, and Amortization. Generally speaking, that is the cash flow that occurs or can be expected from a business that started before you factor in how much money you have to borrow to buy it. That’s basically cash flow from operations, and that is a good starting point for determining what you want to do. So if you have a corporate job and you’re making $150,000 a year, the question is, can you get this business to replace that income in some manner, shape, or form?
Currie: Thank you to the Franchise Business Radio sponsors: Franchise.City, a better way to buy a franchise, and FranServe, the world’s largest franchise consulting and expansion organization.
To listen to the full interview, check out the podcast on Franchise Business Radio. Here’s the direct link: https://probusinesschannelusa.com/franchise-legal-advice-and-business-tax-benefits-on-franchise-business-radio/
Pamela Currie CFC is the host of Franchise Business Radio and has 20+ years in franchising. Her experience encompasses being a franchisee, franchisor performance and educator, franchisor system developer, trainer/mentor, and college advisory board member. She is affiliated with FranServe and Franchise City, and specializes in guiding individuals in finding a franchise. Contact her at Pam@FranchiseIntellect.com.