5 Questions You Need to Answer Before Choosing a Franchise
If you are in the market for a franchise, there are literally thousands to choose from. Those looking to become part of a franchise have to sort through everything from childcare to pizza, salons, gyms and medical facilities. That’s a lot to narrow down. As potential franchisees make sense of all the information and start finalizing their top picks, they often neglect to notice a key factor in the decision process -- how many questions do their favorite franchises actually ask them?
People making a choice as big as becoming a franchisee have so much on their minds and so many questions to answer that they may not focus enough on the way franchises interview them. Not all franchises are created equal, and the way a franchise gets to know you will tell you a lot about their culture. Ideally, you want to work with a franchise that is as interested in you as you are in them. The questions they ask -- or fail to ask -- can tell you a lot.
Above all, a franchise shouldn’t just want to take your money. They should be as deeply invested in building a successful business as you are, and the questions they ask says a lot about what kind of experience you can expect. Here are five questions a francise should ask potential partners:
1. What is your professional background?
Franchising is such an interesting business model because it attracts people from all kinds of backgrounds. There isn’t just one type of person who becomes a franchisee, so a good franchise will want to understand your previous experience to make sure you have what it takes to be a successful part of their business.
Some franchises look for a particular segment of past experience, but most will look at each franchise candidate individually. If a franchise doesn’t care about your past experience, it’s a sign that they’re not choosy about who becomes a franchisee -- which also means they aren’t as likely to be invested in your success.
2. How much time do you have to spend on the business?
Every franchise will have different guidelines for how much time a franchisee should expect to spend on the business. Some franchises are higher maintenance than others. It all depends on the type of product and service, the franchise’s culture of how involved each franchisee will be personally and how easy or complex the business is to set up and run.
A basic mall kiosk will be easier to manage from a distance, but a retail unit that will be built from the ground up as a standalone store will require more time and legwork. Make sure the franchise wants to know how much time you’re willing to commit.
3. What do you hope to accomplish?
If you expect a franchise to be profitable in a month, and the franchise generally isn’t profitable for a year, it’s better to get that out in the open before you sign on the dotted line. Great franchises know how to manage expectations so that franchisees can stay positive and know what they’re signing up for. Franchising isn’t a magic bullet of profitability. It’s a business like any other, and most businesses take time to earn profits.
The franchise should also want to know if you have plans for expansion, since that should lead to in-depth conversations about territories and development. If a franchise makes promises that don’t seem reasonable, take a step back, and do some more research. It’s better to work with a company that is up front about what you can expect than one who makes assurances and might not be there with support after you’ve joined the team.
4. Why are you interested in franchising?
People get into franchising for all sorts of reasons. Sometimes they have always dreamed of entrepreneurship. Sometimes they want to take more control of their careers. And sometimes they are looking to segue out of another career.
The thing is, most people aren’t actually well-suited to run a franchise. Franchisees need to have a unique personality that can walk the line between visionary and team player. If you want to call all the shots, do things your way, and build a brand from scratch, you might be happier with startup entrepreneurship. If you are looking for the support of operations systems, sales practices and complete marketing and training tools, franchising is a better way to go. Franchising isn’t a guarantee of success, but a template for running a successful business. A good franchise recognizes that and will only work with people who are a great fit for the franchising life.
5. Why are you interested in this particular franchise?
A lot of people get into franchising because they think it’s a sure bet for running a profitable business. However, the allure of profitability shouldn’t be the only reason you’re interested in a franchise. If you’re lactose intolerant, you aren’t the ideal person to open an ice cream shop. However, if you’re lactose intolerant and the ice cream shop sells products made exclusively from coconut, almond and soy milks, you might be perfect.
Running a business is about making money, but to do that well, you have to be passionate about what you’re pitching. The best franchises know every franchisee is passionate about the brand, not just the profits.