• Florida Law Requires Disclosure
• Exempt Business
• Get The Facts, Then Decide
• Before You Sign On The Dotted Line...
• Warning Signs

Many Americans dream of owning their business. Although many achieve this dream, others run into financial ruin by falling prey to scams devised by unscrupulous promoters of business opportunities.

A business opportunity is an offer to assist a person in starting his or her own business by providing - either through sales or lease - products, equipment, supplies or service needed to carry on the business.

Business opportunities range from addressing envelopes or assembling toys at home at a cost of a few dollars, to establishing vending machine routes or installing pay telephones for thousands of dollars. Many times, these promoters imply that investors can see a substantial return with minimal effort.

This brochure is intended for those individuals considering a purchase of a business opportunity with an initial investment of more than $500. If you are considering a work-at-home opportunity requiring a more modest investment, such as stuffing envelopes, assembling products or making crafts, contact the Florida Department of Agriculture and Consumer Services at 1-800- HELP-FLA (435-7352) before investing your money, or request a copy of the free brochure, "Home Employment Opportunities."

Florida Law Requires Disclosure
The Florida Sale of Business Opportunities Act is intended to help protect prospective investors by requiring the seller to provide information about the business opportunity. It requires sellers of businesses to provide a disclosure document that includes the information necessary for the prospective investor to make an informed investment decision. This disclosure document must be presented prior to the time an investor signs a business opportunity contract or makes any payment.

The law is administered by the Florida Department of Agriculture and Consumer Services, which is the state's lead agency for consumer issues. The Department operates the state's consumer hotline, 1-800-HELP-FLA (435-7352). As stated in the Florida Statutes, the State of Florida does not review and does not recommend, approve, endorse or sponsor any business opportunity, and the information contained in the disclosure is not verified by the state.

Disclosure Document must include, in part:

• The history, background and financial status of the seller, including the names of officers and general managers of the business, felony convictions, if any, and their bankruptcy history.
• The amount of money required for the investor to get started and whether the money is refundable and under what conditions.
• The financial arrangements and any additional fees that might be required.
• A statement whether the seller guarantees to buy back unsold products. If such a guarantee is offered, the seller may be required to post bond with the Department of Agriculture and Consumer Services and disclose information relative to such a bond.
• A copy of the contract defining the relationship between the seller and the investor.
• A full and detailed description of the actual services to be performed by the seller.
• A copy of the current (no older than 13 months) financial statement.
• A description of the program if training is offered by the seller, and a statement of whether the buyer is required to complete the training to the satisfaction of the seller.
• The condition under which the agreement may be canceled.

Exempt Business
Certain businesses may be exempt from the Florida Sale of Business Opportunities Act. Always check with the Department of Agriculture and Consumer Services by calling 1-800-HELP-FLA (435-7352) to see if the business is required to file a disclosure document and, if so, if the business has complied with that requirement.

If the business is exempt from Florida law, it still may have to comply with federal regulations. For more information contact the Federal Trade Commission, Enforcement Division, Bureau of Consumer Protection, Washington, DC 20580.

Get The Facts, Then Decide
Any individual who is considering buying a business opportunity should get as much information as possible before entering into any contract. Calling the Department's Consumer Hotline at 1-800-HELP FLA (435-7352) for details about the Florida Business Opportunity Act is a good start. Find out if the business is registered with the Department and if there have been any complaints filed against it.

You should also check with our local Chamber of Commerce, Better Business Bureau, local consumer affairs office, or your public library for business directories. Consulting an attorney before investing is also advisable. When considering an investment, compare other operations of the same type. Other companies may offer better benefits.

Before You Sign On The Dotted Line...
Prospective investors should take an active role in investigating the business opportunity before signing any contract or sending any money. A few tips to follow before investing or signing are as follows:

• Talk to current investors, preferably in person. If their names and addresses are not in the disclosure document, ask for them. Ask these investors whether information in the disclosure document matches their experience with the company. Failure or refusal to provide names and addresses of investors should serve as a warning sign that the venture may be questionable.
• Ask questions. Investigate earnings claims. Keep in mind that once you invest your money, you may be competing with other, more experienced independent operators.
• Get all guarantees in writing from an authorized representative of the company.
• Listen closely to the sales pitch. A seller with a good offer doesn't have to use pressure sales tactics.
• Get professional advice - an attorney, accountant or other business adviser could save you a great deal of inconvenience, aggravation and money.

Warning Signs
Be wary of these signs before proceeding:

• Pressure to sign a contract immediately.
• Promises of extraordinarily high or guaranteed profits.
• Claims that profits can be achieved easily or with little work or time investment.
• A required initial investment that greatly exceeds the fair market value of any products, kits or training.
• A large fee payable before you receive anything in return.
• Evasive answers by the salespeople or unwillingness to give disclosure documents required by law.