Select your franchising research information, assess it, reassess it, and make an informed franchise investment decision
Franchising Research and Information
Deciding whether to buy a franchise
As franchisors are fond of saying, a franchise lets you be in business ‘for yourself’ but not ‘by yourself.’ The advantages of a known brand and experienced support continue to draw thousands of new entrepreneurs to the franchise life every year. As a result, franchising has evolved into a complex and diverse business model. With a little capital and a lot of drive, you too can be part of this worldwide phenomenon. Once you’ve made the decision to invest in a franchise, all that remains is to choose your new franchise from the hundreds of systems available.
Which franchise system should you invest in?
Franchising research is the single most important activity in making your franchise investment decision and you’re the one that has to do it. The more information you can gather, in advance, about the specific business opportunities that interest you, the easier it will be to decide which franchise-based opportunity is right for you.
You must put in the time, get the information, assess it, reassess it, and make an informed decision. Without sufficient information, you may end up making the most expensive decision of your life.
Sources Of Franchising Research Information
Current franchisees are your best source of advice
No opinions are more valuable than those of a current franchisee.
Where can you find these franchisees?
Most franchisors provide Disclosure documents, detailing many aspects of their system's operation including a list of current franchisees and likely some former ones as well, therefore, your primary means of contacting franchisees. Once you've had your initial meeting with the franchisor, start perusing the list of franchisees and make calls. Upon meeting those franchisees, you can always ask for a few more contacts.
Current franchisees can give you the best indications of how their franchise is performing and how it would perform for you. They can tell you about types of support their franchisor provides; they can verify capital requirements and opening costs; their locations can demonstrate cleanliness, management philosophy and the effectiveness of the franchisor's training. Good questions will provoke detailed answers without seeming intrusive.
Obtain answers to questions from the people who are currently operating or working for the type of franchise you’re interested in. Write down the names of the people you talk with and the information they tell you, and in doing so, you will begin gathering a body of information that eventually gives you a pretty clear picture of the business you’re considering, without hearing the best-case scenario sales pitch often offered by the franchisors themselves.
As you open discussions with other franchisees from around the country, keep in mind that market conditions in the local economy vary by region. Even if a franchisee continues to experience success in one part of the country, this doesn’t guarantee you’ll experience similar success in your geographic region. Do additional franchising research to determine whether the community where you plan to establish your business can support it, given the local economy, potential customer base, and other localized factors.
Research beats guesswork everytime
The economy never truly "settles down", so the successful franchisees perfect their skills continuously to navigate the highs and lows.
If the economy is still a concern for you, try speaking with some current franchisees in the system you are hoping to be part of. Franchisees who have gone through at least one economic cycle (seven to ten years) should be able to tell you how the business performs over time.
Research is essential!
"There's an old saying. If you think education is expensive, try ignorance."
Franchising Research Sources
How to Start a Franchise
Return from Franchising Research to Best Franchises