What Prospective Franchisees Are Looking For
In a recent survey by FRANdata (an independent research company supplying information and analysis for the franchising sector since 1989) the following reinforced what prospects are seeking.
Out of 100 franchise prospects surveyed:
1) 37% said profitability potential was critical. They consider historical financial estimates or projections the most essential information they need to know about a brand. The unit's ability to generate cash is the primary factor in evaluating the brand.
2) 33% said unique characteristics were important - the way the brand conveys its message.
3) Reputation was important to 32% of those surveyed.
4) 12% considered other factors
5) 9% considered personal experience of the franchisor.
6) Sector (industry type) was considered by 7%
7) Investment level was critical to only 5% of those surveyed.
It was agreed that even when franchisors make Financial Performance Representations, the potential franchisee should research and validate with a minimum of 10-15 existing franchisees.