How does the Washington Franchise Investment Protection Act define a 'franchise broker' in relation to Chesters?
Chesters Franchise · 2025 FDDAnswer from 2025 FDD Document
Advisory Regarding Franchise Brokers. Under the Washington Franchise Investment Protection Act, a "franchise broker" is defined as a person that engages in the business of the offer or sale of franchises.
A franchise broker represents the franchisor and is paid a fee for referring prospects to the franchisor and/or selling the franchise.
If a franchisee is working with a franchise broker, franchisees are advised to carefully evaluate any information provided by the franchise broker about a franchise.
Source: Item 23 — **RECEIPTS (FDD pages 48–197)
What This Means (2025 FDD)
According to Chesters's 2025 Franchise Disclosure Document, the Washington Franchise Investment Protection Act defines a 'franchise broker' as someone engaged in the business of offering or selling franchises. The FDD specifies that a franchise broker represents Chesters and receives payment for referring potential franchisees or for directly selling the franchise.
This definition is important for prospective Chesters franchisees in Washington because it clarifies the role and responsibilities of individuals who may be involved in the franchise sales process. Franchise brokers act on behalf of Chesters, meaning their primary obligation is to the franchisor rather than the franchisee.
Given this representation, the FDD advises franchisees to carefully evaluate any information provided by a franchise broker. This caution is typical in franchising, as franchisees are encouraged to conduct their own due diligence and seek independent advice to ensure they fully understand the franchise opportunity and its associated risks, rather than relying solely on the broker's representations.