Questions to ask during franchise Discovery day - You Can Acquire the Information That You Seek Regarding a Franchised Business If You Have the Appropriate List of Questions.
It is in your best interest to be well-prepared in the event that you are invited to attend a franchisor's discovery day. This is true even if you have not yet come to a decision regarding which franchise opportunities you would like to invest in. Because of this event, you will have the opportunity to go to the franchisor's corporate headquarters and meet with them in order to acquire additional information regarding the franchise. You should have all of the information that you need after meeting with them and speaking with other franchisees in order to make a decision regarding whether or not the franchise is suitable for you.
It is essential that you come to your discovery day experience prepared with specific questions in order to get the most out of it and make the most of your time there. By asking these questions, you should be able to obtain the additional information you require before proceeding with your investment.
The following are some questions that should be asked during the discovery day for a franchise.
What Kind of Assistance Can I Expect from the Franchisor?
When you purchase a franchise, the franchisor will provide you with all of the support and training you require to successfully operate the business. This is one of the most significant advantages of owning a franchise. In most cases, franchisors offer assistance to franchise owners in the areas of site selection and construction, in addition to giving them access to an operations manual. It is also beneficial to have an understanding of the assistance the franchisor will provide after the opening of your location. This includes training that is ongoing for staff members and managers.
How Long Will It Take Before You Start Making a Profit?
Knowing how much money you will make from owning a franchise is essential, as this may be the single largest investment you will ever make in your life. It is likely that this data will be included in item 19 of the franchise's Franchise Disclosure Document (FDD). You will be able to understand the earning potential of the franchise business if the franchisor provides you with an item 19, which is a way for them to be transparent with you. Inquire with the franchisor about their item 19, if they have one, the amount of time it will take for you to see a return on your investment (ROI), and any costs that are associated with the franchise.
How would you describe your relationship with the people who own your franchise?
It is essential for you to collaborate with a franchise that boasts an approachable and friendly franchise team. During the course of the due diligence process, it is important to talk to other franchise owners to get their feedback on how they feel about working with the franchise's team. You can determine whether or not this franchise is a good fit for you by asking this question during the discovery day for the franchise.
How Does This Franchise Stack Up Against the Other Options Available?
Questions to ask during franchise Discovery day
There is intense competition present in each and every franchising opportunity. In order to have one of the most successful and lucrative franchises in an industry, franchisors need to find ways to set their franchise businesses apart from those of their competitors. Because there are so many franchising opportunities available in any industry, you will want to make sure that you invest in the franchise business that provides you with the highest probability of being successful. This could take the form of providing a lower royalty fee or better vendor discounts in comparison to other franchise businesses operating in the same industry. This is something that would be very appealing to a potential franchise owner.
Take advantage of this opportunity to ask the franchisor about their strategies for staying one step ahead of the competition and where they stand in relation to the rest of the industry during the discovery day. You need to find a franchise that is already one step ahead of the competition!
Are You Interested in Growing the Number of Franchises You Offer?
It is essential to have a solid understanding of the long-term goals that the franchisor has for their business. Is there a plan in place for the franchisor to expand the business both domestically and internationally? Do current franchise owners have the opportunity to expand their business into multiple locations? The franchise as a whole ought to constantly be getting better.
Have You Ever Canceled Your Agreements with Franchisees?
There are times when the franchisor-franchisee relationship does not go as smoothly as it normally does, despite the fact that this being the exception rather than the rule. Does the franchisor have relationships with other franchise owners that can be described as contentious? If that's the case, why? Why was their employment terminated? You can avoid having your franchise agreement terminated if you pay your franchise fees on time, if you follow the system that is provided to you, if you behave in an appropriate and professional manner, if you ensure the continued financial success of the business, and if you do not ignore the franchise store by refusing to open the doors.
Do You Receive Many Complaints From Franchise Owners? How About From Customers?
It is essential to have an understanding of the manner in which the franchise deals with complaints lodged not only by customers but also by franchisees, as well as the actions it takes in response to such complaints. You will be able to determine from this whether or not the franchisor will treat your complaints seriously and make efforts to resolve them.
What Will Happen to the System If I Sell the Business and Remove Myself From It?
It is essential to have an exit strategy when evaluating the potential of a franchise opportunity. There are some franchisors that will assist you with the resale of your franchise, which will save you both time and money as compared to having to hire an outside party. You should inquire with the franchisor about whether or not they will assist you with the resale so that you will know whether or not you will need to look elsewhere for assistance when the time comes to sell it. There are a few different ways to exit a franchise system, although the specifics of your exit strategy may be restricted in certain ways depending on the franchise business you run. You have the option of passing the franchise business down to a family member, selling it to an exciting franchise owner, engaging in a resale when you sell it to a new franchisee, speaking with a franchise consultant for assistance in finding quality and qualified prospective candidates, or engaging in a resale when you sell it to a new franchisee. As a crucial part of your long-term planning as a franchise owner, you need to make sure you ask the franchisor what would happen in the event that you left the franchise system.
Do You Have Options Available for Financing?
Purchasing a franchise can be a financially risky and time-consuming endeavor. It is possible that the franchise will provide financing options that will enable you to take out loans in order to buy the franchise in order to make this investment less difficult. The majority of the time, these financing options cover construction costs and even more. Look into the funding options offered by the United States Small Business Administration in the event that the franchise does not provide their own in-house financing options for their franchisees.
Will There Be a Defensible Border Around My Territory?
The majority of franchisors provide their franchisees with the opportunity to purchase protected territories, which means that no one else can own a franchise location in that particular region. Because of this, you will have less competition, which will in turn increase the likelihood of the business being successful.
How Many Different Types of Revenue Are There to Choose From?
One of the appealing aspects of being the owner of a franchise is the possibility of having multiple streams of revenue and of owning more than one location of the franchise. For instance, if you own a fast-food restaurant franchise, you can expand your business by opening additional locations and thereby increase the number of revenue streams available to you. Your franchise business may see an increase in revenue if you choose to provide additional services, such as delivery, catering, or curb-side pick-up options.
Is There a Chance to Network with Other Franchisees at Conferences?
One of the advantages of being the owner of a franchise is having the opportunity to participate in conferences, where you can meet up with industry peers and talk about the latest developments and best practices. Not only does this help to foster a sense of camaraderie within the franchise system, but it also enables you to discover and implement innovative new ways to make your business more successful. The franchisor has the opportunity to demonstrate how much they value the franchisees who are a part of the system by gathering all of the franchisees together in a setting that is light-hearted and relaxed and that enables them to mix business with pleasure. The purpose of conferences is to invigorate franchise business owners about the future of the brand and industry through the use of presentations, speeches, and other activities.
What Are Your Values?
To be a successful business owner, you need to have a number of characteristics that are ingrained in you from birth. These include putting in a lot of effort, being dedicated and perseverant, and having a strong focus on the community. However, value alignment is the factor that will buy whether or not you go through with the purchase of a franchise. Does the franchisor uphold values that are based on faith? Do they place a high value on involvement in the community? Do they have a commitment to diversity and equal opportunity initiatives? Before purchasing a franchise, it is necessary to give all of this some thought.