Investigating a new franchise as a potential side hustle

[Tiber]

I'm a fulltime student and would prefer to stay that way. But financially, I need an additional source of income. I can't get myself to invest 8-10 hours a day that I would be studying to a minimum wage job that would barely cover my wife's monthly health insurance per month. I've been brainstorming like a madman.

I came across a franchise opportunity that seems too good to be true and would like some ideas on how to determine their viability. For the most the concept seems to be compatible with the Fastlane forum commandments... but I'm not sure how to investigate a company... They are newer; they put out a few apps and started some start ups, started this franchise then COVID hit. Their first franchise shop closed because of this. But the concept still seems viable. They adapted their original model because of COVID to something that's even more scalable.

Any advice would be appreciated.

I have search the forum for any threads pertaining to such things, but haven't had decent luck, or the right keywords.

 

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[MJ DeMarco]

Any advice would be appreciated.

Can't give any advice when there are no details to ascertain advice.

You basically asked, "Hey guys, is this product any good?"

But then you failed to tell us anything about the product.

 

[Tiber]

Can't give any advice when there are no details to ascertain advice.

You basically asked, "Hey guys, is this product any good?"

But then you failed to tell us anything about the product.

Ah ok,

I was asking more on how you would investigate a company to see if it is legitimate.

The franchise called New Remedies CBD via Dailee Holdings. Basically you have a few options to sell their products via a store, a mall kiosk, vending machine, or my personal favorite, a digital kiosk that you would need to have permissions of a sort with a store. On the digital kiosk, it would be at GNC or some kind of niche location, like a resort or something. You select what you want to buy on the kiosk, pay for it, it prints out a ticket that you take to the counter, and you receive your goods. This is because in most states you need to be at least 18 to buy CBD products. The "Parent Company," Biz Incubate has an A+ on the Better Business Bureau. They also claim to have all the Federal Trade Commission regulations for franchises, is FDA approved. Other than some info on LinkedIn, I cannot find anything else.

How would go about finding proof of legitimacy.

 

[Walter Hay]

Ah ok,

I was asking more on how you would investigate a company to see if it is legitimate.

The franchise called New Remedies CBD via Dailee Holdings. Basically you have a few options to sell their products via a store, a mall kiosk, vending machine, or my personal favorite, a digital kiosk that you would need to have permissions of a sort with a store. On the digital kiosk, it would be at GNC or some kind of niche location, like a resort or something. You select what you want to buy on the kiosk, pay for it, it prints out a ticket that you take to the counter, and you receive your goods. This is because in most states you need to be at least 18 to buy CBD products. The "Parent Company," Biz Incubate has an A+ on the Better Business Bureau. They also claim to have all the Federal Trade Commission regulations for franchises, is FDA approved. Other than some info on LinkedIn, I cannot find anything else.

How would go about finding proof of legitimacy.

The company seems to be legitimate, but with the wording I have bolded above they cleverly give the subtle impression that their franchises have federal approval.

What has been approved is the business of selling CBD products. The FDA does not have any role in approval of franchises.

The only way you can decide if the franchise is suitable for you is to obtain a copy of their disclosure document. Under FTC franchise rules, the first thing they must provide is a Disclosure Document, but they are first offering a demonstration.

This is what it says on their site: "Download our Franchise Application and submit to info@daileecbd.com for a franchise demo of the model that interests you most."

You should consult a franchise lawyer to see if that is OK as a first step, but I doubt it. I am not a lawyer and I don't provide legal advice.

If you do go through the process to the point of getting a disclosure document, I would be happy to have a look through it for you. You could send it to me via PM.

From what I have seen so far, there has been no mention of them having operated a pilot franchise. If they have not done so for a year, the whole concept is theoretical. See Post#1 in my thread:

Rapid Scaling a business by franchising​

Walter

 

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[Walter Hay]

Thanks for sending the disclosure document. As I suspected, the franchise is virtually non-existent as a franchise network, with none listed as current franchisees, and only one ever having existed, but that franchisee "LEFT THE SYSTEM, TRANSFERRED A UNIT OR HAD AN AGREEMENT TERMINATED IN OUR LAST FISCAL YEAR".

This means you would be a guinea pig.

I would not consider such a franchise. Please remember I am not providing legal advice.

Walter