3 questions to ask a Franchisor
Apart from buying a house, investing in a franchise opportunity could be one of the biggest outlays in a person’s life. You wouldn’t buy a house without a survey and lots of questions, so make sure you do the same with a franchisor. Read on for my top 3 questions to ask a franchisor…
A good franchisor will present a Franchise Information Memorandum after an initial chat to ensure there is a good fit. The FIM contains answers to lots of your questions, as well as financial information such as theoretical profit and loss illustrations and inclusions in the franchise package. It will also cover background information on the opportunity and the business.
Remember the franchisor is checking you out, as much as you are checking them out.
My top 3 questions to ask, and why are:
How do you choose your franchisees? What specific skills and traits do you look for?
It’s important to ensure that the franchisor is only taking on the most suitably qualified people for their network and offering, and not just waving the credit card machine around to get new franchisees onboard.
Will you help me build an activity plan to reach my target level of income?
Great franchisors make their money by having successful franchisees – without franchisees achieving their targets, it makes it impossible for a franchisor to achieve theirs. It is in their best interests to help and support you with an activity plan.
Will my franchise business have a resale value?
In my opinion building a business is building an asset, and the great thing about assets is one day they can be sold off and you take the benefits. Starting with the end in mind, help focus your mind on what you’re trying to achieve.
© Phil Mowat – Franchise Consultant – Ashtons Franchise Consulting
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