With a franchise, there is a proven replicable system that generates consistent results. It is often said “owning a franchise allows you to go into business for yourself, but not by yourself.”
Let’s address the steps specific to buying a franchise.
Identify the franchise opportunity
Contact a Registered Franchise ConsultantTM. You can either contact a Registered Franchise ConsultantTM about identifying franchise opportunities or contact a franchisor directly.
A word about Registered Franchise ConsultantsTM. These professionals are paid by the franchisor and not the franchisee. Franchisors recognize that the clear majority of people who inquire about a franchise may not buy the franchise they are inquiring about. As a result, many franchisors are willing to allow and compensate Registered Franchise ConsultantsTM to interview and qualify franchise candidates.
Take a CVI Assessment. A CVI Assessment or similar assessment will help the candidate identify their inclination towards business ownership.
Review the assessment. Review the assessment with the Registered Franchise ConsultantTM to help narrow the search.
Complete a financial assessment. A review of your financial situation and net worth is important in making the appropriate franchise recommendations.
Identify territories. Identify where the franchisee is looking to operate the business.
Present the companies to the franchisee. After the above assessment and territory review, the Registered Franchise ConsultantTM reviews several opportunities with the prospective franchisee.
Refer to a Franchisor
The Registered Franchise ConsultantTM refers the franchisee to one or several franchisor representatives. The initial call may also include the Registered Franchise ConsultantTM and is the franchisee’s opportunity to better understand the franchise offering.
Franchise Disclosure Document (FDD)
Review the FDD. The FDD is a document provided by the franchisor and outlines many of the details specific to the franchise opportunity and terms. It is highly recommended that the franchisee has a qualified franchise attorney review the document and discuss it in person with the franchisee.
Interview other franchisees.
The franchisee wants to interview current and if possible former franchisees as part of the franchisee’s due diligence.
Attend Discovery Day
This usually occurs at the location of the franchisor and provides the franchisee further opportunity to meet the franchisor’s team and ask more questions.
Make a Decision
The franchisee and franchisor decide if this is the right mutual opportunity and relationship and if it is, make definitive plans to start the operation.
The Registered Franchise ConsultantTM is a valuable resource to both the franchisor and franchisee in moving this process forward towards its natural conclusion.