These are the questions to ask a franchisor before you invest, Suzie McCafferty, managing director of Platinum Wave, says
We’ve helped to sell a lot of franchises over the years from many different business sectors. Some of the questions we’ve been asked by prospective franchisees, however, have stuck in the mind for the wrong reasons:
“If I don’t like it after the first couple of months, I’m just going to sell it to my mate. That’s okay, right?”
“I’m very interested, but I need to know if you’ll change the logo from green to red? I really like red.”
“I’ve got the money to buy it, so I don’t see why the franchisor needs references?”
We’ve had plenty of sensible questions too, of course. Would-be franchisees tend to be on a spectrum that runs from those looking for an opportunity to achieve a better worklife balance through to those who have few questions beyond: “What’s the average monthly net profit?”
An experienced multi-unit operator will decide quite quickly if they think the brand is offering something exciting that the public will like and then they will drill into the figures to see if it’s worth their while - it’s rarely a long decision making process.
That may seem quite cold and calculating to some, but these investors aren’t buying into a dream of being their own boss - they’ve already done that and know franchising works for them.
For the most part, however, prospective franchisees are looking for a chance to go into business for themselves with the added comfort of a proven business system and the ongoing support of a franchisor. If you fall into this category and are currently assessing franchise opportunities, then here are some questions you will want your prospective franchisor to answer. Many of them will be addressed in the marketing literature you’ll have been sent prior to speaking to or meeting with the franchise recruitment team. But you’ll want to expand on those answers until you’re satisfied with the answers and explanations given.
The following list of questions is by no means exhaustive, but it should help you in the first meeting to establish a feel for the company and the people you’ll be dealing with.
Consider what kind of culture you want to be in? Are you looking for a kind, nurturing environment or a highly competitive one? Do you want a lot of support or to be left alone to run your own business?
Once you’ve decided if you and the brand are a good fit, you can then get into greater specifi cs about what’s in the franchise agreement and how much money you might make.
The answers to the last two questions should reveal a lot about the franchisor/franchisee relationship and culture. Is it a case of sink or swim? Is it a hands off approach or are franchisees encouraged and supported to grow their businesses?
Some brands will have reward and recognition programmes for their networks designed to continually motivate franchisees to keep pushing.
While these questions are more about establishing a fit for you in terms of personality, ethics, drive and culture, they will also help you decide if this franchisor is likely to offer you that ‘something extra’ you’re looking for from buying a franchise, as opposed to starting your own business from scratch.
Is its aspirations for you in line with your own? Is the franchisor going to help you get to where you want to go?
There are hundreds more questions to ask and things for you to get to the bottom of, but here’s one last piece of advice: never forget that securing your perfect franchise isn’t only your decision to make.
A good franchisor will be scrutinising you from the first email or phone call. You want a franchisor who cares as much about making the right decision as you do - and the best ones always do.
Suzie McCafferty founded Platinum Wave in 2010, after gaining more than 10 years’ experience in the engine room of franchising, first as a franchisor who built her own retail brand from a single store to a network of over 60 outlets in six countries, then as the franchise director and board member of a multi-million pound division of a recruitment plc. She is the chairperson of the British Franchise Association’s Scottish regional forum.
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