5 Must-Ask Questions Before Opening a Franchise
So you’re thinking about becoming a franchisee? You’re not alone. There are over 800,000 franchise establishments employing nearly nine million people in the United States alone. The benefits of franchising are undeniable, but it’s not a decision that you should make on a whim.
Many people choose owning a franchise based on the belief that success is guaranteed. Unfortunately, this is not always the case, so potential franchisees should do their research before jumping into a major financial commitment.
In order to be successful, it’s important to plan ahead, ask a lot of questions and obtain a realistic picture of what life as a franchise owner would be like. Are you stuck on what questions to ask? No problem, we have five must-ask questions when deciding on the perfect franchisor.
1. How long has the franchise been in existence?
Before opening a business, you want to know its longevity, so it’s important to ask historical questions up front. Who were the founders and what was their motivation for starting the business? Assess your own motivations and make sure you possess a similar passion for the industry.
Take Kumon for example. Today, Kumon is the world’s largest education franchise, but 60 years ago it started with a father’s love for his son and his desire to help him develop a love of learning. Success of the program grew and now there are over 4.2 million children enrolled at nearly 25,000 Kumon Math and Reading Centers in 50 countries and regions.
2. How much do I have to invest before I can open my doors?
The financial commitment to opening a small business is not an easy feat and is typically one of the biggest questions or deterrents. The initial investment for starting a franchise can vary greatly so it’s important to discuss it with the franchisor so you have a clear understanding of your investment. How much net worth and capital do you need? What’s the initial investment? What are the start-up costs and franchise fees?
Kumon is an attractive opportunity because it has one of the lowest franchise fees at $1,000 and all franchisees qualify to receive initial financial incentives valued up to $19,000 to assist in start-up costs. Potential Kumon franchisees need to have investment capital of $70,000 and a net worth of at least $150,000.
3. How many franchised units are in operation?
Whether you are looking into an emerging franchise or a long-standing brand, it’s important to know how many individual franchise units are currently in operation so you have an idea of market share. It’s true that franchising offers the independence of small-business ownership supported by the benefits of a big business network, but it’s important to find a franchise that has an established reputation.
With nearly 1,500 franchise units in the U.S. alone, an investment in Kumon includes a recognizable brand name and a proven business model.
4. What support do you offer beyond the initial training?
Most franchisors offer initial training and support, but what happens after you open your doors? You want to make sure your franchisor won’t disappear once you’ve launched.
Kumon, for example, assists all new franchisees in the development of a concrete business plan, supports local marketing with national and regional student recruitment initiatives, and provides ongoing training and opportunities to learn from experts at annual conferences.
5. What’s it really like to work in this business?
The franchisor has answered a lot of your pressing questions, but now you are wondering what it’s really like to work in the business. Don’t be afraid to ask a franchisee what it’s like to work with the franchisor. Would they buy this franchise if they had the chance to do it all over again? These answers will speak volumes to the franchisor relationship.
Making the decision to own your own business encourages you to find a career that is meaningful, rewarding and something that you are truly passionate about. If you have a passion for education and an entrepreneurial spirit, learn more about joining the world’s largest education franchise.