Buying a Franchise - The Top Questions You Can Expect From Your Franchisor
Posted on November 12, 2010 by My Franchise Law
When interviewing with prospective franchisors to determine if you could have a successful business partnership, they will be looking for several key traits to ensure you are a good investment. Here’s a run-down of some of the basic questions you can expect during your meeting:
- What is your experience? : Your potential franchisor will want to know what background you have in running a business, including any previous franchise experience. They will be trying to get a feel for both how well you can run a business, and how well you will fit in with their established business model. They will also try to determine if you are adaptable to working in a environment where you will not be the ultimate decision maker.
- What are your goals and expectations? : Your franchisor will want to know if you are on the same page when it comes to goals for business growth and day-to-day operations. They will also try to determine if you are a good investment that will keep their revenue stream running strong for the long term, or if you’re simply looking to invest in a business that you may not stick with in the long run.
- How much are you willing to invest? : Owning a franchise isn’t just a financial investment, but also a significant investment of your time and energy for several years until your business is off the ground. Your franchisor will want to know if you have what it takes to survive the stress of setting up your new franchise, and the can-do attitude to build a successful business from the ground up.
- Where will the money come from? : Your franchisor will want to know how you plan to obtain financing, and how much you have ready to invest. This is important because the first year in a franchise business often does not see a profit, so you will have to have enough resources to keep yourself afloat until you start to see a steady stream of revenue.
- Why them? : It is also important for the franchisor to know why you have chosen their business to invest in. Do you have experience with their product or service, or have you merely chosen them because you think you can make a substantial profit?