Valuable Tips on Validating Franchises to Buy! Avoid the Shortcut to Disaster

One of the most important aspects of validating franchises to buy is first to understand how to organize a process of collecting and processing information that can be useful to evaluate the best choice for you before making a significant investment. A professional franchise Selling Consulting Services Book consultant can be your most valuable asset in helping you both understand the vital need to make this part of your due diligence procedure and how to integrate your findings into an intellectual decision making process moving toward a final choice of businesses.
First you must know that a consistent organizational plan to get the most out of your validation efforts is absolutely necessary. To begin, and at the very least, you should review the franchisor’s Franchise Disclosure Document (the FDD) with careful scrutiny. It is required by franchise law (FTC) that you be provided such a document and proof of receipt is required to substantiate you did in fact actually receive this document from the franchisor. Paying particular interest to looking at the trends of franchise sales, terminations, litigation, investment costs, principal’s backgrounds, bankruptcies, and finances among other things. Once you become satisfied the company is a surviving candidate for further due diligence you can proceed to the next level of validation.
Often times the franchisor will provide you a list of active franchises that you may call to allow you to ask specific questions regarding their experience with the franchisor and to learn more about their personal challenges with becoming a successful business owner. While accepting this list of franchisees to call is in most cases legitimate with regard to the franchisor wanting to match you to similar demographics for the sake of relevance I don’t advise using their list exclusively. Career Consultant Near Me Franchise law dictates that once you receive the FDD you are entitled to contact any active franchisee (and inactive franchisee listed) and not just limited to those given you by the franchisor. I would ask the franchisor to identify several franchisees that are less than one full year into the business, several that are between 1 – 3 years in business and several with 5+ years in the business and plan on making contact with no less than 10-15 franchisees in total.
Always provide the franchisees the courtesy of arranging a convenient time to speak with you in advance of your call and be mindful of their time by promising to limit your conversation to no more than 15 minutes. Be mindful that calling a fast food franchisee at lunchtime may be convenient for you but his busiest time of the day.
It is critical that you ask the same prepared questions to each franchisee so you have more consistent answers to evaluate. Your franchise consultant can help you prepare these questions for you to ask. You would want to ask such questions as:
If you had it all over to do again would you make the same choice you made with this franchisor?Did you experience any significant issues in starting the business that were inconsistent to what the FDD prepared you to anticipate? If so what?How is the communication and support by the franchisor?How complete was the training?Were your financial expectations and experiences in alignment with what other franchisees or the franchisor lead you to assume? If not what is more realistic to expect?
You need to be prepared to accept that everything you may heart may very well not be necessarily positive but nonetheless useful information if consistently heard among franchisees. Remember not everyone will operate their business as a top performer and will struggle no matter how good the franchise system is. There will always be several operators as standout successes, a group in the middle doing OK, and always some people at the bottom of the performance scale. You have to visualize who you would more closely associate with and be more accepting of their comments to you during the validation phase.
Be prepared to discuss you findings with the franchisor objectively and factually. A thorough validation is time consuming but perhaps the single most important aspect of investigating franchises to buy and the prudent business practice when considering investing thousands of dollars of your precious capital. Shortcutting this process is a disaster in the making and a deliberate effort on your part to sabotage any opportunity for you to make a better business decision for your future. Engaging a qualified franchise consultant to assist you is the smart thing to do. Visit for more information.

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