What are your top five tips for a prospective franchisee considering purchasing a franchise?
1. Ask ‘awkward’ questions. For example, ask about any failures that the franchisor has had in the network. Try to find out if these were down to the franchisee or lack of support on the part of the franchisor. Ask about the franchise agreement renewal and establish whether the franchise is a real business, ie when you come to retire or leave, there’s a business to sell.
2. It’s a two-way process: while you’re evaluating the franchise business, the franchisor should be assessing you as a prospective franchisee. Be very careful if you feel they’re not interested in your skillset and suitability.
3. Make sure that you are allowed to speak to any franchisee in the network. Do not be steered by their preferences for you to speak only to their top performers.
4. Is the business fully accredited with the British Franchise Association (bfa)? This is a kitemark of quality for franchisors. Through a code of ethics, bfa franchisors must disclose a range of details regarding their business.
5. Be sure to put sufficient time and effort into developing your business plan and the associated projections, as it will be your yardstick