Buying a franchise is a big decision. To make the right choice, you have to do your homework. In the franchise-buying world, this protocol is known as validation, which involves talking directly to franchisees. Hearing their unfiltered opinions is an invaluable source of information that will help you determine if the franchise is a good choice and fit. You’ll also hear about the lessons they’ve learned, giving you a leg up as you start your franchise journey.
Ask and You Shall Receive
To get the most out of validation, you’ll want to carefully prepare a list of questions. Some popular ones include: What is your typical day as a franchise owner like? How long did it take to break even? If you could do it all over again, would you? Don’t be afraid to dig deep, especially when it comes to the financial requirements. According to Entrepreneur’s Top 10 Money Questions, you’ll want to try to pinpoint the actual total investment needed, as franchise circulars often only include a wide range. Other questions should focus on franchisor support and responsiveness – a crucial factor to your success as a franchisee. Ask for specific examples on how the franchisor helped with site selection, training and marketing.
Do Your Due Diligence
Make sure you talk to enough franchisees to hear both success stories and challenges, and talk to former franchisees to learn why they left. There are many reasons why franchises fail that are unrelated to the franchise system, but if systematic problems do exist, a thorough validation process will unearth them. Also carefully read the Franchise Disclosure Document. You’re likely to find areas that need clarification and this is your chance to review it with an audience who has nothing to lose.
Making sense of it all can be overwhelming, but don’t expect your decision to be entirely risk-free. That doesn’t exist when it comes to business ventures. If you find yourself having a hard time making a decision, then you may be better off working for someone else. This is one of the errors to avoid when considering a franchise opportunity. Or you may just need the guidance of a seasoned franchise expert in making this important decision. Either way, best of luck to you on your journey to franchise prosperity.