Important Questions to Ask a Franchise Owner During Validation…

Getting in Touch with Franchise Owners

When reaching out to franchise owners, it’s essential to have a well-thought-out outreach plan. Start by obtaining a list of franchise owners from the your Franchise Development Representative. Make sure to ask your representative about the preferred mode of contact for franchise owners, whether it’s through emails, texts, or other means. Craft a personalized message introducing yourself, expressing your interest in the franchise, and requesting a 20-30 minute call to learn more about their experience. Persistence is key, so be prepared to follow up multiple times if needed.

Warm-Up Questions

Once you have scheduled a call with a franchise owner, it’s important to start with some warm-up questions to establish rapport and thank them for their time. These questions can help you understand their background, motivations, and initial experiences with the franchise.

• What were you doing before you opened your franchise?
• What inspired you to open your own business?
• Why did you invest in this particular franchise?
• Do you mind if I ask you some questions about your experience so far?

Digging Deeper: 10 Key Questions

After establishing a comfortable conversation, it’s time to dig deeper into specific aspects of the franchise. Here are ten important questions to ask franchise owners during the validation process:

1. How does the franchisor assist with site selection (if brick-and-mortar-based business)?

The selection of a suitable location is crucial for brick-and-mortar-based franchises. Inquire about the support provided by the franchisor in terms of site selection. Understanding their assistance in this area will help you evaluate the franchisor’s expertise and resources.

2. How long did it take you from signing your franchise agreement until you opened for business?

Opening a franchise involves various steps, and it’s essential to have a realistic timeline. Ask about the duration between signing the franchise agreement and opening the business. This will give you insights into the process and potential challenges.

3. What support does the franchisor offer regarding marketing and customer acquisition?

Generating revenue is a crucial aspect of any business. Inquire about the marketing support provided by the franchisor to help you acquire customers. Understanding the franchisor’s marketing strategies and resources will give you an idea of how they support franchisees in this area.

4. How has your revenue ramped up?

Revenue growth is a key indicator of a franchise’s success. Ask franchise owners about the progression of their revenue over time. This question can lead to discussions about marketing strategies, pricing, customer retention, and other factors that contribute to revenue growth.

5. How difficult has staffing been in your business?

Finding, retaining, and managing a competent staff is often a challenge for business owners. Inquire about the franchise owner’s experience with staffing and any specific challenges they have faced. Understanding the labor market dynamics can help you assess the potential difficulties involved in staffing.

6. Were the financial assumptions you built into your pro forma accurate?

Profitability is a critical aspect of any business. While direct questions about income and profitability may be sensitive, you can ask about the accuracy of the financial assumptions made during the planning phase. This can lead to discussions about profitability and potential adjustments to the business model.

7. What has been better than expected with your business?

Every business has its surprises, both positive and negative. Ask franchise owners about aspects of their business that have exceeded their expectations. This can give you insights into potential advantages and strengths of the franchise.

8. What is the biggest challenge you faced in your first year in business?

Starting a new business can be challenging, and franchisees often encounter obstacles. Inquire about the biggest challenge the franchise owner faced during their first year. This question can provide valuable insights into potential difficulties and how the franchisor supports franchisees through them.

9. What skills are most important for a successful owner to use in this business?

Franchise ownership requires a specific set of skills. Ask franchise owners about the skills they consider crucial for success in this particular franchise. This will help you evaluate whether your skill set aligns with the requirements of the business.

10. Are you looking to expand to additional locations?

Understanding the growth potential of the franchise is essential for long-term success. Inquire whether the franchise owner has plans to expand to additional locations. This question can reveal insights into the scalability and market demand for the franchise.

Validating a franchise opportunity through conversations with existing franchise owners is a valuable step in the research process. By asking the right questions, you can gain real-world insights into the franchise and evaluate its potential fit with your goals and aspirations. Remember to be respectful of the franchise owners’ time and make the most of the opportunity to gather information that will help you make an informed decision.