Important questions for your franchisor before you buy

In a job interview, the candidate is given a chance to ask questions about the company they will be working for. Similarly, before you buy a franchise, there will be an interview with the respective company owner. This is to understand if you are financially capable and have the knowledge or experience to run their brand under your franchise. In addition, this is also the time when you, before deciding on what franchise to invest in, must ask questions to understand the brand you will be working for. Below are some important questions for your franchisor before you buy their franchise.

What is your company’s history?

Like any important financial relationship, it is important to understand the history of the franchisor and the company. You need to know how they started to understand and where there are heading. This question will also help you understand if they have any verifiable track record on their business. It is necessary to understand how the franchisor is making their money. If non-royalty sources are higher than the royalty, then proceed with caution.

How can I trust you?

Trust is the key to a long healthy relationship. Especially for one that involves investing all your time, commitment and money. Ask them why you should trust them and their model. Understand what motivates and drives them. For instance, learn about their beliefs and ethics. Once this is satisfactory, then proceed to ask them about their business.

Other relationship with franchisors?

Buying their franchise means, you are likely to become one of their many other franchisees. Therefore understanding their existing relationships with other franchisors is crucial. For instance, what kind of training and support is offered? Do the franchisees have a representation in decision-making committees? This will go a long way in understanding how you can expect to be treated along your journey as their franchisee. Also, investigate the litigation faced by the franchisor from the other franchisees. Too much on record is never a good sign.

What is the franchise fee?

Get clarity on what is the initial investment expected from you. This fee on average is $35,000 dollars. But this can vary anywhere between $0 – $100,000 or more depending on their concept. Additional expenses may include the cost for support, training, future royalties, franchise transfer, liquidation, equipment, and even software. Though most of these numbers will be mentioned on the Franchisor document, it is better to discuss and get clarity on these during the interview.


Buying a franchise involves a huge amount of financial and emotional investment. So the interview is the chance you get to clarify all the important questions necessary to assess their reliability. Nevertheless, it is essential to complete all your due diligence before you invest with care. If you have further doubts or questions, it is advisable to do more research and proceed only if you are fully satisfied with their franchise system.

Source: Franchise Direct

Similar Read: Tips to succeed the Franchisor Interview

Related Read: Basic accounting know-how for a franchisee

Additional Read: Tips to Consider in Buying a Franchise

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