4+ Questions To Help You Buy A Franchise With Confidence

Rob Lancit

Date

Sep 23, 2015

Franchisors encourage prospective franchisees to question existing franchisees, but many prospective franchisees tell us that they do not know “the right questions” to ask. We want to begin by telling you there are no “wrong questions” to ask in franchising. Generally, the more questions you ask the better.

However, existing franchisees are busy people, and so you’ll want to make the most of your time that you spend with them, either in person or on the phone. With a nod to efficiency, here are some “key questions” to ask existing franchisees. Feel free to word the questions in any manner that makes you more comfortable. The important point is to get helpful information that will lead to your decision to buy or not buy a particular franchise.

1.      “As someone who bought the franchise ___ years ago, knowing what you know now, would you buy this same franchise again?”

Experts say never to ask Yes/No questions, but in this case it’s a good idea because you want a definitive answer. If you ask ten franchisees from the same brand that key question you will be able to add up the “yeses” and “nos” and decide if this is a franchise you should buy. If the majority of existing franchisees answer “no”, then you probably need to look for another opportunity. There could be exceptions, but you’ll want to understand what they are before you go ahead.

Answers to each of the key questions lead to other questions. Regardless of a franchisee’s answer, you can always follow up and ask, “Why?” Or if a franchisee answers, “no” you could come back with, “Under what circumstances would you change your answer to a yes?”

2.      “Do you find the business as satisfying today as you did when you first got started?”

Satisfaction is an important consideration in the life of a franchisee. In fact, many people explore franchise opportunities to get away from unsatisfying jobs. It’s another Yes/No question, but again the answers lead to other questions: “What happened to change your degree of satisfaction?” . . . “What could you or the franchisor do to make the business more satisfying?”

3.      “What’s the secret to the success of the top franchisees?”

It’s an open-ended question that can reveal important facts for you to consider. For example, if the franchisee answers, “Location!” you need to zero in on where to open your franchise. If the answer is “sales skills” or “management skills” or “accounting skills” you need to evaluate your own skills, or your ability to hire those skills. Keep in mind that without those key skills, you’re like not to be as successful as you’d like.

4.      “If I invest the money the way the franchisor suggests (i.e. in training, advertising, location, etc.) and I work the business as well as you have, how much money can I expect to earn my first year as a franchisee? The third year? The fifth year?”

What you really want to know is how much money you’re going to make. Don’t you? The franchisor will likely duck that question for legal reasons, but franchisees will give you an honest answer if you ask the “money question” non-invasively. If you’re expecting to earn six figures annually, but no franchisee ever has with this brand, you need to know that upfront. It may mean you’ll have to buy more than one unit to meet your financial goals. Or you may want to seek out a different brand.

There are many other questions to ask, but answers to these four will help you buy a franchise with confidence.

 

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