Published with permission from BizAssist

Questions to ask a Franchisor

If you are interested in buying a franchise, make sure that the franchisor has answered all your questions before making any important decisions.

Here are some questions you should be asking your Franchisor.

About the Franchise

• What makes this franchise so unique compared to other franchises?

• How long have they been in business and what is their success rate?

• Ask to have access to the names, background and experience of the individuals who own the franchise.

• Ask to have the contact details of five of their existing franchisees to check on the franchisors credentials and financial status.

Support

• Will you be trained and how long will it take?

• How many people will you need to employ and will the franchisor help with their recruitment and training

• Does the franchisor step in to support if the franchisee experiences operational problems?

• How do you communicate with your franchisees?

• Are there monthly, quarterly or annual meetings for the franchisees

Finance

• How much will it cost in total when purchasing the franchise. Ask for a detailed breakdown)?

• What Monthly management fee (Royalties) will you have to pay?

• Will they assist you in drawing up a business plan?

• How long to the day you open your outlet for business?

• How soon can you expect to reach break-even?

Can the franchisor do the following for you?

1. Arrange Finance

2. Provide management and/or accounting services when needed

3. Assist with the correct site selection

4. Hand over a completed, fully operational store

5. Provide marketing, promotions and advertising support

6. Develop a blueprint for conducting your business

7. Enable and equip a person to operate the business

8. Source a computer programme to manage and control every aspect of the business

9. Help with merchandising

10. Supply continuous training when needed