6 Important Questions to Ask about Any Franchise Business

If you have the opportunity to meet with the owner of a franchise business during the initial researching phase, it’s important to have a handful of questions prepared. These questions are chosen to help you make the best decision you can about whether to buy the coffee franchise based on the information gathered. Some questions you should ask franchisors or current franchisees include:

What are Franchisees Saying about the Franchisor?

You can ask this of the franchisor for the franchise business or you can ask it of the franchisees. You can also ask it of both just to see how the answer varies in order to understand how honest the franchisor is and where the words of the franchisees agree with the franchisors. This can often be enough to find out how often the franchisor communicates with his franchisees.

What are the Turnover Rates?

Between franchisees and employees for the franchise business, you will want to know how easy (or difficult) it will be to secure employees for your business. This will give you an indication of how successful the coffee shop franchise can be and what type of risk you will assume.

What is the Failure Rate?

This information is often included in the FDD for just about every franchise business, but it isn’t always accurate and it isn’t always in the clearest terms. Make sure to ask in your meeting with the franchisor to be more direct in your understandings of possible failure and success.

How are Conflicts Resolved?

When you’re a franchise business owner you want to know how your franchisor communicates with their franchisees when there is a conflict of interest. Are they involved at all or do they just leave the franchisee to figure it out on their own?

What Ongoing Support is Offered?

If you’re new to franchise business ownership, you may be very interested in knowing what help you can expect from corporate and when you will be left on your own. Some franchises offer more to franchisees in terms of crisis support, ongoing training for new products or services, and updates on new law adjustments.

Would You Buy Your Franchise Again?

Depending on who you’re asking in the franchise business, consider other variations of this question. This will give you a chance to observe whether the franchisor or franchisee has prepared a response or if they’re thinking about it for the first time. Either way, it will tell you a lot about the confidence the individual has in the business before you purchase one yourself.