Questions To Ask Franchisor

What assistance does the franchisor provide? Do they assist with training, store design, construction, site selection? Do they have access to demographic data to get an understanding of the audience within the market area? What types of support will the franchisor provide once your franchise has opened its doors? After the initial investment, will there be additional financial obligations requiring working capital? Does the franchisor offer any form of financing? Ask the franchisor how many franchises have been sold in the state you will be operating in during the last 12 months, and how many have been opened for business? What types of territorial restrictions and protections have been set up by the franchisor? Is the franchisor planning on expanding within your state? Are they focusing on any specific locations? What arrangements are established through the franchisor in terms of product supply? Ask to see a current price sheet. Ask if the franchisor has been forced to terminate any of its franchisees and if so, can they detail the reasons for this decision. Have any franchisees failed or gone bankrupt? Are there any current lawsuits pending or past judgments against the franchisor? What steps are taken to settle disputes between the franchisor and franchisees?

Questions To Ask Franchisees

How long have you owned your franchise? Is your franchise profitable? In which month did you reach your breakeven point? Have you made approximately the same profit that was forecast in the disclosure document? Were your opening costs consistent with the original projections in the disclosure document? Are you satisfied with the franchisor's support? Are you satisfied with the product or service? Is the operations manual, clear, up-to-date and adequate? Are you satisfied with the marketing and promotional assistance provided by the franchisor? Was the initial training and ongoing support sufficient for you to operate your business? What was your background prior to buying your franchise? Are deliveries of goods provided by the franchisor timely and competitively priced? Is the franchisor fair and friendly to work with? Does the franchisor listen and help you with your concerns? Have any franchisees had disputes with the franchisor? What was their nature? Were they resolved fairly? Do you know of any disputes between the franchisor and the government? Do you know of any disputes with competitors? Who are the major competitors? What is the company's biggest competitive advantage? What is the company's biggest competitive disadvantage?