11 Questions You Should Always Ask Before You Buy a Franchise

“Discovery Day” is always an exciting time for a franchisor. After months of back-and-forth, it’s the day we finally get to meet a potential new franchise partner in person. We bring them to headquarters, introduce them to the team, and show them what we’re all about. It’s exciting for them, too: candidates always tell us they can feel a buzz throughout the entire office.

At O2E Brands, we don’t sell franchises — we award them. So Discovery Day is basically like a high-stakes final job interview. But just as much as we’re searching for the right person to join our company, our candidates are searching for the best opportunity for them, too - and that's why our selection process is so thorough, because we need for both parties to determine if it's the right fit.

Other franchisors don't have as comprehensive a process, and this can sometimes leave potential franchisees left feeling confused, in the dark, or not knowing what questions to ask.

With that in mind, here's 11 questions every potential franchise owner should ask before signing on the dotted line.

1. Who are the biggest competitors in my local market?

Market research is one of the most important first steps when starting any business — franchise or not. You’ll have to put in some legwork to figure out what conditions look like in your chosen area (this is part of our process), but your franchisor should be able to provide practical insight on your outlook for success.

2. How has the market changed over the last five years? 10 years?

Depending on your industry, things can change drastically over the years. Fortunately for us, AI hasn’t disrupted our space — yet — and until they have robots painting homes, we’re safe from automation. But there are always other factors at play, like the economy, location and consumer spending habits. Taking a peek at how things have evolved will help you plan for the future.

3. What sets your brand apart from the competition?

Before going into business, you’ll want to have a clear understanding of your franchisor’s key differentiators. Get specific and ask for concrete examples. If the franchisor is wishy-washy about their value propositions, maybe they don’t have one — and it might be better to look at another opportunity.

4. What kind of support will I get from head office?

A good franchisor will be available to help you through the startup process. An exceptional franchisor will provide startup training and ongoing support throughout your entire journey. After all, your success is their success. They’ll do whatever it takes to get you on the right track.

5. Where will the company be in the next five years?

At our company, we have a Painted Picture: a crystal-clear snapshot of what our business will look, feel and act like in the next five years. Obviously, not every franchisor will have a literal document describing its five-year plan — but they should know where they’re headed and how they plan to get there.

6. How has the organization evolved in the past 10 years?

We’re a very different company than we were 30 years ago. In the last five years alone, we’ve doubled from two brands to four! The ability to evolve, adapt, and grow is a sign of a strong franchisor. We always strive to become a bigger, better company — and you’ll want to know that your chosen franchisor goes for growth, too.

7. What is your industry’s biggest threat and opportunity?

At this point of the process, you should already have an idea of the threats and opportunities facing your industry. But your franchisor can provide an insider’s perspective that you may not have even thought about. Find out what you’re up against — and what you’re working with — so there’s fewer surprises down the line.

8. What has been your biggest franchise failure? What happened and why?

This is your chance to suss out how transparent your franchisor is — and how they handle conflict. Ask for a concrete example to find out how they respond to tough situations. Learning about a failed franchise will also help you understand what not to do when you get started.

9. How much say do I have in how I run my franchise?

A lot of franchisors enforce strict rules and heavy-handed policies, leaving little room for you to exercise your entrepreneurial chops. Some people like to have that much structure, but if you’d prefer to have some freedom, you’ll want to get clear about it upfront.

10. Do you provide any financial assistance?

Starting a franchise is a serious investment of time, money and resources. Some companies will provide financing options or offer discounts for specific groups like veterans. If you need support, just ask. Even if the franchisor doesn’t have a financing program in place, they’ll be able to provide resources to help you raise startup capital.

11. Are we aligned on values?

This is by far the most important thing we look for when awarding franchises. Our values (Passion, Integrity, Professionalism and Empathy) guide everything we do, and we expect everyone in our organization to live by them, too. In our experience, the franchises that fail are typically misaligned with what we stand for.

Joining a franchise system should never be a one-way street. It’s a big commitment for both the franchisor and franchisee, so take the time to get to know each other beforehand. It could make the difference between starting an ordinary business... or an exceptional one!

If you're interested in learning more about owning a franchise with us, you can learn more here.