If you’re seriously considering the idea of buying a franchise, there are lots of things you need to do before you can become an owner. Some of them are obvious. Some are not. I’m going to share a few not-so obvious things with you, so you’ll be better prepared to take the plunge into franchise business ownership.
Ask the Right People Your Questions
The best way to get the facts about the franchise opportunities you’re interested in is by asking the right people; the franchisees. They’ve already written the check. And, they’re living and breathing the business day in and day out.
Believe it or not, lots of would-be franchise business owners never do this. They never talk to existing franchisees. They never ask them questions.
One of the questions you should ask is this one:
“What do you wish you would have known before you purchased the franchise you now own?
It’s a great question to ask because the answer you get may end up revealing something that you would have never known until you yourself became a franchisee.
Find Franchisees Who Aren’t Happy
On the surface, finding franchisees that are unhappy may seem counter-intuitive. Why would you want to seek out franchisees who are unsatisfied and/or unprofitable?
Answer: To get a reality check.
When you find a franchise concept that you really like – one that looks better and better the more you learn about it, it’s important to slow your momentum down a little. A decision this big requires a ton of fact-gathering. It’s way too easy to let your excitement about the possibilities engulf you. Keeping your emotions in check is crucial.
You may be able to find one or two unhappy franchisees as you make calls. If you’re only finding happy owners, that’s good. But, there probably are a few unhappy ones. Find them.
Re-call a couple of the happy franchisees you talked with and ask them this:
“Are you aware of any real unhappy franchisees? If so, who are they, and why do you think they’re unhappy?
Their answers will bring you closer to finding a few unhappy franchise owners. Once you do, call them and find out why they’re unhappy. You may find that it’s actually them. They may just be wrong for the business. On the flipside, you may find out about internal issues going on company-wide. If you find problems, it’s perfectly okay to ask your franchise salesperson about them. Maybe they’re working on resolutions.
A Day in the Life
You need to find a way to spend some face-time with one of the franchisees you’ve called as part of your research. And, you want this face-time to be in their place of business. In their franchise business.
All you have to do is call a couple of them back and ask them if you could spend a day with them in their franchise business. Stress that it must be convenient for them. They have businesses to run, so be flexible. If they’re willing to let you spend a day with them in their franchise location-or even a few hours, go ahead and visit. As a matter of fact…
Try To Arrange In-Person Visits With TWO Franchisees.
By visiting two different franchisees, you’ll be able to get a much broader feel of the franchise business concept. You’ll also be able to observe two different operations run by two different operators.
Tip: Try to do some of the actual “work” while you’re there. See if it feels right.
Legal Stuff
Franchise contracts are pretty complicated legal documents. Before you sign a franchise agreement, a contract that can lock you in as a franchise owner for up to 10 years, you need to hire an attorney.
Specifically, the attorney you hire needs to be a franchise attorney.
This is not the time to take advantage of free or cheap legal help like the kind of help that comes from an old college friend who happens to be a lawyer, or a family member who has a law practice – unless they’re franchise attorneys.
Today’s franchise attorneys keep up with the ever-changing rules, regulations, and actual laws that pertain to franchising directly. A business attorney who’s “looked over” franchise agreements in the past is NOT the person you want to hire. The amount of money you may be about to invest in a franchise business warrants the hiring of a specialist.
Buying a franchise to be your own boss can be a great choice. If you’re willing to do the things that most people don’t do during the investigation phase of your search, you’ll increase your chances of success as a franchise owner.
The Franchise King®, Joel Libava, is a franchise ownership advisor. He’s the author of Become a Franchise Owner! (Wiley Publishing) and owns and operates Franchise Business University. Joel contributes a blog post to Franchise Direct monthly.