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7 Important Questions That You Don’t Ask Before Joining A Franchise

  • Amrita Singh
  • September 1, 2023
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7 Important Questions That You Don’t Ask Before Joining A Franchise
7 Important Questions That You Don’t Ask Before Joining A Franchise

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Entering a new business is a big deal and you must know everything about its establishment and operations. If you are joining a franchise business, you must have a set of questions for the franchisor. We suggest you to revisit those questions once to see whether you have covered all crucial aspects or not.

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Generally, people ask about the company’s background, capital requirements, royalty, franchise fee, and other such things. However, there is a lot more that you should know because just basic information about the franchise business will not help you in a long run. We have curated 7 important questions that you must ask before joining a franchise. They will help you in making a better decision.

Let’s see the questions.

How much liquid capital will be required once I join a franchise business?

Ask how much liquid capital is needed before joining a franchise
Know how much liquid capital will be required to run the franchise business

In general, franchise enthusiasts enquire about the overall investment required to join a franchise. However, it is not enough. The cost of establishing a business and the cost of operating a business are two different things. And you should know exactly how much money will go into both these things. 

On this line, you must know how much liquid capital will be required. Franchises often have to run the business with their own money in the initial months. It takes some time for a business to achieve a break-even point. It is a point where the expense and revenue of a business get equal. And the owner no longer has to put their own money into running a business. 

So, have a clear idea of the liquid capital requirements before joining a franchise. You will need it for paying salaries, paying bills, purchasing inventories and other such expenses. 

Who are your competitors? What sets you apart from your competitors?

Ask details about the competitors before joining a franchise business
You should understand the background and market position of competitors

Every business has a set of competitors. You must have a clear list of all minor and major competitors of the business to assess the growth prospects. Sometimes, competitors can dominate a new franchise aggressively. If you will not have exact information about the competitors you might face issues in the long run. Here are some basics you should enquire about competitors before joining a franchise:

  • Who are your competitors?
  • Strengths and weakness of competitors
  • The market position of competitions

In order to retain its own identity in this competitive world, a business should have some unique qualities or approaches. Ask your franchisor how they set themselves apart from their competitors. You should have an idea about their strategies and tactics to outgrow the competition.

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How do you handle manpower recruitment and training?

Ask everything about recruitment and training for your business before joining a franchise
Ask everything about recruitment and training for your business before joining a franchise

Hiring the right kind of people at the right time is more complex than you think it is. It takes a lot of time, effort and money to carry out recruitment processes. While some business owners outsource recruitment, we suggest you choose a franchisor who does it all themselves. 

No matter how good a recruitment agency is, they cannot relate to the essence of a business as much as the owners. Because they are not directly involved with the processes. Hence, you should either do it all on your own or try finding a franchisor who promises recruitment and training of your entire staff. 

Do not forget to ask about the details of training, especially if the roles require a high level of skills. Some franchisors set up proper training academies to refine the skills of people who work for their franchisees. And, you should definitely look for such franchisors. 

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What support do you offer beyond the initial setup?

Ask about the support system before joining a franchise business
Know how long and to what extent franchisor will support you.

You should not stop at recruitment and training, go one step ahead and ask – what support you offer beyond training. 

Why?

Because every business faces some challenges. Sometimes it may not be easy for you to handle discrepancies or issues as a newbie. For example, there can be a sudden shortage of inventories, or there might a sudden boost in demand for your service or product. 

In such situations an ideal franchisor don’t leave their franchise partners unassisted. Ask the franchisor whether they will offer support after initial set up or not. Be particular about the time, because many franchisors stay supportive during the establishment process and initial operations. This is not ideal, you should have a support system even after years of joining a franchise business. And the good part is there are several successful and profitable franchises like Tumbledry which offer complete support at every stage of business operations.

Choose a franchisor who is readily available to sort your issues and streamline things every time they go out of hand. Because it is not a cakewalk to handle major issues when you have just entered a new business or a new industry. 

How do you resolve disagreements or disputes?

Before joining a franchise know how franchisor will handle disputes and disagreements
Know how franchisor will handle disputes and disagreements

No matter how well you manage your business there can be disagreements and disputes. They may occur between staff or consumers as well. Sometimes disagreements take place between franchisors and franchise staff. Other than this, there can be disputes with vendors. 

Your franchisor should have a full-fledged support system to provide you with round-the-clock assistance in such situations. Thus, you should definitely ask how they will resolve issues before you join a franchise.

What are your expectations from your franchise owners?

Before joining a franchise ask what are their expectations from franchise partners
Ask what is expected from the franchise owners

Franchisors expect dedication and commitment towards business. There are various ways to show these things, ask them what they expect you to do as a franchise owner. Some franchisors may want you to devote a certain amount of time to running the business, while some may expect you to follow their instructions properly.

You should know the level of involvement a franchisor will have in your business. So, don’t hesitate to ask about how it will look like doing business with them.

What kind of input will I have in marketing and advertising?

Ask about marketing and advertisement plans before joining a franchise
Ask about marketing and advertisement plans

After joining a franchise business you cannot expect profits overnight. It takes a good of hard work towards marketing and advertising to grow a business. You may know how tough it is to carry out these activities. But if your franchisor will be there to support you, it will be easier. Some franchise owners take complete charge of marketing and advertisement. They make the journey of recognition a cakewalk for franchisees. So, you must whether they market their franchisees both offline and digitally or not. Then, try to understand the whole process of their marketing. It includes the marketing strategies, plans and their implementation.

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These were some important questions to ask a franchisor before joining a franchise. Ask them and expect a detailed answer for every single question. Their answers will help you visualize how you will run your business. You can analyse the business and your capacity as a future franchise owner as well. This will help you have a successful franchise business soon.  

Disclaimer: The opinions expressed in this article are those of the author. They do not necessarily purport to reflect the values or views of Tumbledry.

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