Acing Franchise Research: 5 Types Of Questions To Ask Franchisee Partners

 

Franchises in the US leverage tried-and-tested business models to drive value for customers. The franchising industry enables aspiring business owners to start their ventures with profitable blueprints. If you plan to start a business, buying a franchise can be an excellent option. But before you make a franchise investment, you must spend some time on due diligence and franchise research. You must understand a franchise offering in detail before finalizing your buying decision. One aspect of the due diligence process is interviewing other franchises. You can speak to the existing franchise owners to understand their experiences. This process can help you assess the franchisor and make an informed decision. Let’s break down the five types of questions to aid your analysis! 

#1 Ask them about their working relationship with the franchisor.

The franchisor’s support and guidance are of paramount importance while running a franchise business. Hence, it is imperative to assess how well the franchisor maintains working relationships with the different franchisee partners. Here are some questions you can ask to evaluate this aspect: 

●       What type of support does the franchisor provide? Do you get the level of support you were promised during induction?

●       Have you ever had any disputes with the franchisor? If yes, how did they resolve it?

●       Does the franchisor accept feedback from franchisees and make necessary changes?

●       Is it easy to work with this franchisor? 

#2 Ask questions about the training programs.

The best franchise opportunities in the USA come with comprehensive training facilities. Potential franchisees must assess the training facilities before investing in the business. Some questions you can ask to evaluate this aspect are:

●       Did the franchisor provide adequate training to help you set up the operations?

●       Does the franchisor provide ongoing training support to deal with the dynamic business environment?

●       How much would you rate the franchisor’s training program on a scale of 1-10? 

#3 Ask questions about business finances.

One of the core objectives of buying a franchise is to build a profitable venture. You must examine the financial performance of the franchise system before investing your money. The following questions can help you judge this aspect:

●       Did the franchisor provide an accurate estimate of start-up costs and working capital requirements when you joined? Were there any hidden fees?

●       Did the franchisor accurately forecast the profit potential of the franchise units?

●       Is your franchise unit profitable? How long did it take you to break even and start earning profits?

●       What are the cash flow issues in this business? 

#4 Ask questions about the business operations.

Understanding the business operations will help you make a balanced judgment about the franchise investment. The following questions can help you evaluate it better:

●       Are the SOPs effective and adequate to cover all the operational aspects?

●       Does the franchisor regularly update the operational manuals?

●       Have you faced any risks or hazards while running the operations? 

#5 Ask questions about the sales and marketing process.

Sales and marketing campaigns drive revenue generation and profitability for franchises.

●       Does the franchisor provide regional or national marketing support?

●       How much do you spend on marketing and advertising campaigns every month?

●       Are you satisfied with the franchisor’s assistance with your marketing efforts?

●       What is your return on marketing investments? 

These questions can help you gauge the franchise’s potential and make a reasonable decision. For more tips and information about franchises to buy, keep reading Franchising Magazine USA!