Buying a Franchise - The Importance of Talking to the Franchiser
One thing that surprises me when working with people who go through the franchise search process is the fact the large majority of them, while trying to execute their search, actually fail to talk to a franchisor.
Once candidates begin their search they usually do quite a bit of research themselves. They go online, fill out forms and send out requests. However, they fail to act on the majority of information sent to them and usually resort to examinations of the franchiser’s site and a short review of marketing materials available.
It appears that the candidates often base their opinions about franchise opportunities mainly on their impressions of seeing the business from the outside. They fail to talk about the business with the company itself. They don’t consider an even more valuable next step in the process, serious discussions with the franchisees currently in the system.
I understand that part of the reason people fail to talk to the franchisers is because of fear of being sold on the concept by a skilled company representative. It is true that a skilled salesperson will always hold an edge in a negotiation with a novice customer. However, one must consider two things. First, franchising regulations provide a good deal of protection to an average consumer. Second, a solid franchisers’ main interest is to grow their system through bringing on board only qualified individuals who will have a high probability of succeeding, not to sell as many units as possible.
Buying a franchise is not a 2 hour transaction. A potential candidate and a franchiser will have weeks, if not months to evaluate each other and decide if a good fit exists. I strongly advise potential franchisees to speak to the company they are evaluating as soon as they have interest in the business. Only the franchiser can clearly answer all the questions, explain their business model and provide an overview of all the systems provided by them.
It is hard to imagine how a franchise candidate can evaluate his or her potential with a particular franchise without speaking to the main office and franchisees in that system. I would suggest for anyone serious about buying a franchise to invest considerable time to actually talking to people within the system. Candidates need to ask questions about financial performance, location preferences, employees, etc. Based on that, they need to evaluate how that particular business would fit into their desired lifestyle.
It is impossible to seriously evaluate a franchise opportunity without talking to the franchisor. In the end, if a candidate had enough desire to send an inquiry for information about a particular concept, upon reviewing the information, they have to reserve judgment until discussing the opportunity with the company itself.
Leave a Reply