Q: I have been speaking with a franchise company, and I am going to attend their discovery day in a couple of weeks. What should I expect, and how can I be prepared, so I get the most from my visit?
A: Discovery days are a chance for both the franchisor and prospective franchisee to sit down face to face, discuss the franchise opportunity and determine if the decision to become a franchisee is the right decision for both parties. If it is, they can move forward, complete their due diligence and finalize the contract. If it is not the right decision, it's better to stop the process right then and there than to proceed into a long-term agreement.
You need to have done your homework and gained some insight into the business and the market to ask the right questions at discovery day. Before going to meet with the franchisor, we recommend you:
2. Visit any competitors to the franchisor located in the area. What do they do really well? What do they not do really well? How busy are they at peak times and at other times? How would you compete against them?
3. Read up on franchising in general and take a look at competitive franchise offers, if you have not already done so. The easiest way get an overview of competitive franchise offers is to visit their Web sites. The information they provide online should allow you to compare franchise programs and may prompt some questions when you visit with your prospective franchisor.
4. You should also be prepared to make a short presentation about yourself during discovery day and to discuss why you think you'd be a successful franchisee of the system, experiences that have had an impact on your life, how you have learned from a failure or disappointment. Be ready to answer any question you would typically expect on a job interview.
Most franchisors structure discovery day so the prospective franchisee can meet as many of the headquarters staff as possible. Typically, each staff member does a short presentation on their area of responsibility and how they will be supporting you if you are accepted as a franchisee. They also have the opportunity to ask you questions and evaluate whether they believe you would be successful as a franchisee of the system.
It is important to take the opportunity to ask your questions in each of the areas that are presented, such as training, operations, research and development, human resources and marketing. These are the folks who know the information inside out. Asking questions demonstrates your interest in the business and in what they are contributing to the franchise system. It's also a good way to learn a little about them and how they react to you.
When you leave discovery day, you should have enough information to know whether or not you wish to pursue the opportunity based on the empirical information you collected. You should also have a feeling as to whether you like the people you met and whether you have confidence in their leadership. Before you enter into a long-term agreement to become a franchisee, you should feel positive about the business and about the people.
Remember, making the franchise decision is a two-way street. You should be evaluating them just as they are evaluating you. If it doesn't feel right, chances are, it's not.
Michael H. Seid is managing director of Michael H. Seid & Associates, a West Hartford, Connecticut- and Troy, Michigan-based management consulting firm specializing in the franchise industry. Seid co-wrote Franchising for Dummies (IDG Books) with Dave Thomas, the late founder of Wendy's, and serves on the International Franchise Association's Board of Directors.
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.