There are several things you have to do when planning to buy a franchise. While some of these things are quite obvious, others are not. In this post, we are going to look at 4 not-so-obvious things you need to do, so you can be better prepared to own a franchise.
Ask Questions
There’s no better way to gather facts about a franchise you’re considering than by asking those who are already running the business: the franchisees. They have already purchased a franchise. And now, they are immersed in the business every day.
You may find this hard to believe, but a lot of prospective franchisees don’t ask questions. They don’t speak to existing franchise owners. They don’t speak with them.
One important question to ask current franchisees is:
“What do you wish you knew before buying the franchise you are operating?”
This is a great question to ask existing franchisees, as their answer can help you discover things you won’t have known until you become a franchise owner yourself.
Look For Franchisees Who Are Unhappy
Seeking out unhappy franchisees may not seem like a good idea on the surface. Why should you look for franchise owners who are not satisfied or doing okay in the business?
Quick answer: To get a grip on reality
When you see a franchise idea that interests you – one that looks more appealing the more your research it- you need to slow down a little bit. A franchise investment is a big decision that requires a lot of fact-gathering. It is very easy to get caught up in the excitement about the possibilities. That’s why it is important to control your emotions.
As you contact franchisees, you should be able to find one or two owners who are not happy in the business. If all the owners you talked to are happy, that’s great. But there may be a few unhappy ones too. Here is how to look for them:
Ask a few happy franchisees you contacted this question?
Do you know any unhappy franchise owners? If yes, can you tell me who they are and why you think they are not happy?
The answer you get will help you find a few unhappy franchisees. When you do, reach out to them and try to find out the reason why they are not happy. You may realize that they are the reason. They might just not be cut out for the franchise business. On the other hand, you may also discover internal problems all the franchises of the company are dealing with. If you notice any issues, it is good to talk to your franchise sales representative about them. Perhaps, they are trying to resolve them.
Spend a Day in the Business
Look for a way to meet with one of the franchise owners you contacted as part of your due diligence. And make sure this meeting occurs in the place where they run their franchise business.
You just have to talk to a few of them and ask if you could spend time with them in their business. Emphasize that this could be any day that is convenient for them. Keep in mind that they have business to take care of, so be flexible. Whether you are looking to spend a day or just a couple of hours in their franchise location, just go there. In fact…
Arrange Physical Visits with Two Franchise Owners
Paying a visit to two different franchisees will enable you to get a broader sense of the franchise business idea. You will also have the chance to see how two different locations are managed by two different owners.
Tip: While you are at the place, try to do some of the real work to know how it feels.
Legal Stuff
Franchise agreements are complex legal documents. Prior to signing a franchise contract (that can bind you as a franchisee for 10 years or more), it is important that you get an attorney.
To be specific, the attorney you get has to verse in franchising.
You should not use free or cheap legal help at this time, such as legal assistance from an old college mate who is a lawyer or a relative who owns a law practice, except they are franchise lawyers.
Franchise attorneys are up to date on the constantly changing regulations, rules, and real laws that have to do with franchising. You are not looking for a business attorney who has reviewed franchise agreements in the past. Considering the amount of money you are about to put into a franchise business, it is important that you hire an expert.
Purchasing a franchise can be a good decision for those who want to become their own boss. If you are ready to do the things that many people don’t do while in the franchise research phase, you will raise your odds of being successful as a franchisee.
