Does Southern Steer require the Franchisee or its Operating Principal to be an experienced businessperson?
Southern_Steer Franchise · 2025 FDDAnswer from 2025 FDD Document
Franchisee has conducted an independent investigation of the Southern Steer Business contemplated by this Agreement and recognize that the success
of Franchisee's Southern Steer Business is speculative, involves a high degree of financial risk and depends, to a large extent, upon Franchisee's ability as an independent business person and Franchisee's skills, initiative, hard work and other factors.
Franchisee understands that Franchisee may sustain losses as a result of the operation or the closing of Franchisee's Southern Steer Business.
Franchisee represents a
Source: Item 22 — ITEM. 22 CONTRACTS (FDD pages 61–168)
What This Means (2025 FDD)
According to Southern Steer's 2025 Franchise Disclosure Document, while there is no explicit requirement that the Franchisee or its Operating Principal be an experienced businessperson, the document emphasizes the importance of the franchisee's capabilities and acknowledges the risks involved in the business.
The FDD states that the success of the Southern Steer business "depends, to a large extent, upon Franchisee's ability as an independent business person and Franchisee's skills, initiative, hard work and other factors." This suggests that while prior experience isn't mandated, certain business-related skills and personal attributes are critical for success. Southern Steer also advises franchisees to consult with advisors of their own choosing and acknowledges that franchisees have been given ample time to do so before signing the agreement.
Furthermore, the Franchisee, Operating Principal, and Designated Manager are required to complete the Initial Training Program. The Franchisee, Operating Principal, or Designated Manager must successfully complete the Initial Training Program before the Southern Steer business opens. This training aims to equip the franchisee and their team with the necessary knowledge and skills to operate the business according to Southern Steer's standards. The franchisor can also require additional training at the franchisee's expense if the Southern Steer business fails to meet certain performance standards.
The FDD also states that the franchisee has conducted an independent investigation of the Southern Steer business and recognizes that its success is speculative and involves a high degree of financial risk. The franchisee also acknowledges that they may sustain losses as a result of the operation or closing of their Southern Steer Business. This acknowledgement suggests that Southern Steer expects franchisees to approach the business with a clear understanding of the challenges and risks involved, implying a need for some level of business acumen or at least a willingness to learn and adapt.