Put Your Best Foot Forward
Learn how to invest your IRA or 401k into a franchise penalty-free. ($50k min)
Q: I want to buy a particular franchise. The franchisor has invited me to their headquarters to meet with their executives before I'm approved as a franchisee. How can I tell what they're looking for in a franchisee, and how can I make a good impression? Are there certain things franchisors look for in a franchisee?
A: Most of the more professional and savvy franchisors do develop a profile of their ideal franchise candidate. This profile is then used to create the proper message in their franchise marketing materials (advertisements, brochures, etc.) and to select the media to target their franchise message to the right audience.
Since different franchisors have a different franchisee profile based on the knowledge, skills and abilities necessary to operate their particular concept, we can't give you a specific answer without knowing which franchise you're considering. Our guess is that you meet the franchisor's minimum requirements or you would not have been invited to their headquarters for an interview.
A few franchisee attributes tend to be universally sought after by franchisors. Franchisors like a franchisee who:
- will follow the franchisor's system. In your meeting, you won't win any points by suggesting you have a better idea, can improve the franchisor's operating system, or that you'll operate your business differently no matter what the franchisor says.
- represents their brand in a positive light. Unless the franchisor has told you they're business casual, wear a business suit. And even if the franchisor has indicated they're business casual, put the emphasis on "business." A professional appearance goes a long way in establishing your credibility. And it's not just dressing the part--make sure you're well groomed for the meeting and carry yourself as a professional.
- has some knowledge of the industry in which the franchisor operates. Do your homework so you can comment on the franchisor's business, the competition, and consumer demand for the product or service. Ask questions that demonstrate your knowledge.
- knows the community in which the franchise unit is located. Highlight your knowledge and any experience you have in the community, and be sure to stress any community activities in which you are or have been involved.
- has basic business skills. Franchisors have training programs to prepare a new franchisee to operate their concept, but many rely on the franchisee having some business savvy. Be prepared to discuss your business background and management experience.
- is financially qualified. Be prepared to explain where you'll get your initial investment--from your savings, parents or the bank.
Remember that the decision to franchise is a two way street--both parties must decide that you becoming a franchisee is a good idea. Take the opportunity to size up the franchisor; assess their ability to provide support and lead the company not only in the good times but through tougher times as well.
The franchisor will probably present their training program, marketing and advertising support, research and development activities, and special or cooperative purchasing programs designed to give franchisees a competitive advantage. Listen carefully to what they tell you and ask any questions you may have about how these programs operate. Ask also about the experience of the franchisor's headquarters staff; for example, what is the background of the training staff? Have they worked as a franchisee of the system? Do they have experience in education?
How about the marketing staff--are they professional marketers? Do they have experience in advertising or media?
How long has the franchisor's staff been with the franchisor? Is there a high level of turnover among headquarters staff? Are people put into positions for which they are not qualified, merely to fill a spot?
A meeting at the franchisor's headquarters is important to both sides. While you want to make a good impression, don't overlook your opportunity to get the information you need to make the decision to become or not become a franchisee.
Michael H. Seid, founder and managing director of franchise advisory firm Michael H. Seid & Associates, has more than 20 years' experience as a senior operations and financial executive and a consultant for franchise, retail, restaurant and service companies. He is co-author of the bookFranchising for Dummiesand a former member of the International Franchise Association's Board of Directors and Executive Committee.
Kay Marie Ainsley, managing director of Michael H. Seid & Associates, consults with companies on the appropriateness of franchising; assists franchisors with systems, manuals and training programs; and is a frequent speaker and author of numerous articles on franchising.
The opinions expressed in this column are those of the author, not of Entrepreneur.com. All answers are intended to be general in nature, without regard to specific geographical areas or circumstances, and should only be relied upon after consulting an appropriate expert, such as an attorney or accountant.
For reprints and licensing questions, click here.