If you are looking at a franchise opportunity, the most important thing you can do to protect yourself is to talk to existing and former franchisees about the strengths and weaknesses of their franchise system.
But what do you actually ask them? Here are 10 great questions from www.AllBusiness.com.
1. Are you happy with your franchisor? Why or why not?
2. How long did it take for you to realize a return on investment?
3. What are your approximate earnings, and are they in line with your expectations?
4. Did your franchisor adequately estimate the amount of operating cash that you needed?
5. How thorough was the training your franchisor provided? Did it prepare you to run this business?
6. Were there any hidden franchise fees or unexpected costs?
7. Is your territory big enough to allow you to hit your goals?
8. Are there restrictions on the products you sell and use in your business? Are you required to use designated vendors?
9. Does the franchisor advertise as much as they said they would?
10. What type of business experience, education, and skills did you possess before buying this franchise?
AllBusiness,com also has a lot of related articles for prospective franchisees. Examples:
· More and More Women Find Success in Franchising
· Selecting a Franchise
· A Common Trap for New Franchisors
· 10 Signs of a Great Franchise Opportunity