BRITISH FRANCHISE ASSOCIATION NEWS
The UK’s voluntary self-regulating governing body for franchising Question time
How to approach head office meetings to dig deep into the franchise opportunity on offer
Y
ou’ve found a brand that appeals. You’ve done some research, you’ve received the prospectus, checked things out online and so far, so good. If you meet the criteria
set by the franchise – remember, joining a franchise is a two-way process, matching the right people with the right business (and if it isn’t then walk away, why would you want to be in a network that lets just anybody operate under the same brand as you?) – then one of your next steps is going to be a trip to head office.
This is an invaluable opportunity for you to glean a lot of information and explore whether this is the right franchise for you. Don’t just treat it as standard practice or a formality, because it isn’t: this is where you start to get into the nuts and bolts of the company and, just as importantly, the people behind it.
It might be as part of a discovery day or it might be a meeting on an individual basis but either way, plan your head office visit(s) in advance and you’ll be in a much better
position to assess the franchise. There are a couple of key points to remember. First, don’t underestimate the importance of face-to-face time with the people involved at head office. If you do go ahead and join the franchise, you’re going to be having plenty of contact with the team in training, supporting and growing your business. Make sure you can envisage having a strong working relationship with them. Second, a good franchisor welcomes your questions. Finding the right franchisee is time-consuming and comes at no little expense, so the more knowledge you have on the business, the better for both parties; the strength of a network depends on the quality of its franchisees. So, what sort of questions should you be asking? Broadly speaking, you want to find out about the history of the business, the people involved in it and the exact nature of the opportunity in front of you, including the costs incurred initially and on an ongoing basis, as well as the company ethos and the support on offer. In addition, you should find out as much
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as possible as part of your due diligence process. Can you speak with existing franchisees of your choosing? If not, why not? Find out about the financial position of the business; ask about franchisee turnover and profit projections, where they come from and whether they are based on actual trading figures that you can verify. Find out about the daily operations for a franchisee and how information is reported back to the franchisor. Open disclosure is practised by ethical franchises – bfa member franchises abide by the Code of Ethics for franchising and have passed strict accreditation before being invited to join the Association. Full and accurate disclosure forms part of that code. If your prospective franchisor is not a member of the bfa (see website for full list) and you feel they are hiding things from you at this stage, that should give you serious reservations about working alongside them on your business. It’s worth repeating: the more open your eyes are from the outset, the more successful a franchisee you’re likely to make. Whilst you can’t expect business confidentiality to be ignored – and certainly not before the possible signing of a non- disclosure agreement as part of the process – you should expect open, honest and helpful answers to your enquiries. Remember, there are no stupid questions. If you don’t know, ask. You should never be made to feel afraid to ask a question and you should carefully note down the response. You should not be rushing your decision when considering joining any franchise.
The value of the answers you receive will be a matter for your judgment and an important component in determining whether you should proceed further. You can, of course, verify the value of the answers through the experience of existing franchisees, who are your best source of information when weighing up what you’ve been told. They have, after all, been living with the business and with the franchisor for some time already so their responses will help in your decision-making – more on this in a future feature. Your number-one job is to research the franchise opportunities in front of you. Certain questions could be crucial at this stage in ensuring that you don’t question your decision later down the line, after you’ve already parted with your cash. Ask them. n
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