Questions to Ask a Franchisor When Buying a Franchise
Questions to Ask a Franchisor When Buying a Franchise
So buying into a franchise system seems to make a lot of sense for those who want to be in business for themselves but not by themselves. But how do you know what questions to ask franchisors as they present their franchise system to you with the ultimate goal of asking you for a commitment to join? This commitment involves signing a contract and a check.
Some basic questions are:
What is my total estimated cost to open?
Does this amount include working capital?
How many franchised units (stores or outlets) have failed and why?
How many people signed up with your franchise and were never able opened?
Who are the competitors and why would I choose you over them?
Do you provide any guidance, in writing, about what I can potentially earn?
What is my territory and how is it protected?
Do franchisees have a say in how our advertising dollars are spent? (Many franchises have an "Ad Council" made up of franchisees)
How does the franchisor make their money?
What materials or services am I required to buy directly from the franchisor?
These questions are a start and the franchisors' willingness to answer them should help you gauge their sincerity. The existing franchisees are often a more productive group to speak with. The existing franchisees-just like you-went through a research process with the franchisor and now are either reaping the rewards of franchise ownership or regretting their decision. You'll find that they are usually very willing to provide you with their thoughts, regrets, and opinions.
Questions to Ask a Franchisor When Buying a Franchise - To learn more about this author, visit Peter Casey's Website.
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Those with an entrepreneurial spirit and seasoned business owners agree that franchises hold great advantages over independently owned businesses. So many of the "back office" concerns have been developed, tested, refined, and often even perfected. Most independent business owners can't devote the time or resources to compete with the operational and marketing systems that franchised models provide.
So buying into a franchise system seems to make a lot of sense for those who want to be in business for themselves but not by themselves. But how do you know what questions to ask franchisors as they present their franchise system to you with the ultimate goal of asking you for a commitment to join? This commitment involves signing a contract and a check.
Some basic questions are:
What is my total estimated cost to open?
Does this amount include working capital?
How many franchised units (stores or outlets) have failed and why?
How many people signed up with your franchise and were never able opened?
Who are the competitors and why would I choose you over them?
Do you provide any guidance, in writing, about what I can potentially earn?
What is my territory and how is it protected?
Do franchisees have a say in how our advertising dollars are spent? (Many franchises have an "Ad Council" made up of franchisees)
How does the franchisor make their money?
What materials or services am I required to buy directly from the franchisor?
These questions are a start and the franchisors' willingness to answer them should help you gauge their sincerity. The existing franchisees are often a more productive group to speak with. The existing franchisees-just like you-went through a research process with the franchisor and now are either reaping the rewards of franchise ownership or regretting their decision. You'll find that they are usually very willing to provide you with their thoughts, regrets, and opinions.
Questions to Ask a Franchisor When Buying a Franchise - To learn more about this author, visit Peter Casey's Website.
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John PowerJohn Power, founder of Biltmore Franchise Consulting, has extensive experience developing and marketing franchises and business opportunities. He has been in and around franchising for over twenty years. From 1980 through 1990 he conceptualized, organized, and developed the American Video Association. He grew AVA to 2,000 national members, before selling the company it 1990. It was later merged into another home video marketing company. From 2000 to 2005 he worked as a contract marketing and human resources consultant to several local and national companies. In 2005 Mr. Power began working as a franchise development consultant on a full-time basis. Since that time he has helped more than three dozen companies initiate and develop their franchising program. He notes that there are many companies interested in developing a franchise program, and who need his specialized assistance. Mr. Power is a “hands-on” franchise consultant. He said, “I am the ‘nuts and bolts’ person who tends to the details for my clients.” Mr. Power holds a B.S. degree with a major in Marketing. See: www.biltmorefranchise.com You may contact Mr. Power at: jpower@biltmorefranchise.co - Visit John Power's Website |
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Anne BarrAnne Barr has over 26 years experience in sales and marketing, six years as a franchisee. She has assisted over 367 business owners and purchasers to achieve their goals in career change, transition and exit strategy. She holds the designation of Certified Franchise Executive from the International Franchise Association, Certified Business Intermediary from the International Business Brokers Association and Board Certified Broker from the Texas Association of Business Brokers. Anne is active in professional organizations, networking groups and volunteers for non-profit entities. As owner/operator of four successful businesses, Anne has proven people skills and enjoys helping clients find the right "fit" in business ownership. Visit www.FranchiseOpportunitySpecialist.com for more information about me and my company. - Visit Anne Barr's Website |
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Staging DivaDebra Gould, aka The Staging Diva®, is President of Six Elements Inc., an internationally recognized home staging company. Inspired by many requests from aspiring home stagers wanting to start similar businesses, Gould created the Staging Diva Home Staging Business Training Program. Gould has trained over 1000 Staging Diva Graduates worldwide to start staging businesses. Buying decorating and selling six of her own homes in four years lead to an interest in real estate staging which she turned into a career with the launch of sixelements.com in 2002. Since then she has staged hundreds of homes in addition to teaching home staging training. Gould is the author of several home staging resources including a series of popular ebooks made up of a Design Guide, Color Guide and Portfolio Guide. For more information about Debra Gould visit stagingdiva.com. - Visit Staging Diva's Website |
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John BrennanJohn Brennan Ed.D. Dr. Brennan is President of Interpersonal Development, LLC, a training and development firm. Interpersonal Development has provided sales training and coaching to more than 3,000 sales reps from over 100 companies. A native of Australia, Dr. Brennan received his doctorate from the University of Rochester. His dissertation researched the effectiveness of Behavioral Modeling Technology in training people in interpersonal skills. While he has spent most of his career designing or delivering training, he was also a Vice-President of Sales of a training and development franchise with operations in 25 markets. Dr. Brennan has designed and delivered sales training in North America, Asia, Europe, Australia and the Middle East. He has been a guest speaker at numerous national and regional professional conferences. When Microsoft wanted Best Practices articles on sales for their web site, they called Dr. Brennan. The results are at http://office.microsoft.com/en-us/FX011387391033.aspx His firm’s clients have included Volvo, The Prudential, Merrill Lynch, Eastman Kodak, Gannett, Equifax Europe, the Economist Group and countless small businesses. - Visit John Brennan's Website |
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Jay Kubassek(Jay's Full Bio: EvanCarmichael.com/jaykubassek) In five years, Canadian-born entrepreneur Jay Kubassek went from selling mufflers at a Midas franchise to revolutionizing Internet marketing with the 2004 launch of CarbonCopyPRO, a online marketing education company, now worth over $20 million with customers in over 160 countries.
As an independent film producer, his upstart film fund Aliquot Films is currently producing a films with Spike Lee and Abel Fererra (starring Ethan Hawke and Dennis Hopper.)
Jay's entrepreneurial spirit is irrepressible. He’s the owner of five companies, a professional speaker and trainer, international real estate developer/investor, extreme sport enthusiast and emerging philanthropist. Jay resides in NYC with his wife Jamie, son Milo and dog Cooper. Visit Jay's official website: www.JayKubassek.com - Visit Jay Kubassek's Website |
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