What questions do I need to ask when considering a franchise?

Don’t be afraid to ask many, many questions before you take the leap into franchising. Good franchisors welcome questions because it shows you are serious and want to be well informed.

It is also essential to talk to past and present franchisees and learn from their experiences. Under the Franchising Code of Conduct, franchisors are required to provide contact details of franchisees – if they have left the system ask them why. If they are current franchisees, ask them to share what is working for them and what isn’t.

When purchasing a franchise, ask how long the franchise has been operating, how fast it is growing, and how many franchisees renew their term. Dig deep into the fee structure and also if you must purchase from preferred suppliers (and whether the franchisor received rebates from this). Also ask what marketing and lead generation support is provided, and if there are additional costs. Training is important, ask if training is ongoing or if extra training can be provided as needed.

If the franchisor is not upfront and transparent about the business’ history, operations, costings and fees, feedback mechanisms and current performance, then walk away.