Guide To Buying Another Franchise: Evaluate the Franchisee Support

For many entrepreneurs, the choice to go into franchising is heavily influenced by the support and proven systems associated with the franchise model. Still, not all franchisee support structures are created equal. Franchisees evaluating their next opportunities should take a deep dive into the support available in their prospective systems and ensure they fully understand what each franchisor will offer. 

“I recommend that candidates investigate more than one brand. You’re then able to compare and contrast data, facts, franchisee knowledge and franchise owner experiences,” said Liz Leonard, a franchise advisor and franchise owner. “If your collection of facts and data are not aligned, it will be evident and require more of your time to get to the bottom of it. Digging deep, dedicating the necessary time, interviewing franchisees and not rushing the process will help you become more clear on whether or not this is the right brand for you.”

How Do I Know if the Franchisor Is Offering the Kind of Support I’ll Need?

While there are some widely agreed-upon support structures or resources that most franchisors have, ultimately, what is or isn’t a deal breaker when it comes to support is up to the franchisee.

Leonard suggests that franchisees consider their needs and look into support accordingly as it relates to operations, marketing, recruiting and other aspects of the business. Franchisors can handle these things internally, provide a reference or approved vendor for franchisees to connect with or give franchisees free rein to handle the tasks how they choose. 

Each franchisee will have a different level of comfort in handling each aspect of the business, so gaining a strong personal understanding of what is and isn’t available, beyond a statement like “We’ll help with that,” is crucial. What does that help look like? How long will that help be available?

If you don’t feel like you have enough information on the support that will be available to you, you need to ask more questions. Ultimately, you are the only one who can decide if the support available will adequately address your needs.

Widely Embraced Support Structures To Keep an Eye Out For

In addition to any wide-reaching resources a franchisee is interested in, Leonard suggests candidates learn more about a franchise’s localized or individualized support structure.

“Something to consider is having a dedicated business coach,” she said. “Their intentions and goals are to help you leverage the resources within the company, whether it be the sales, marketing, financial, operations, accounting, finance or the recruiting side — they should be evaluating different aspects of the business and meeting with you regularly.”

Some brands’ regional operation managers or franchise business coaches are franchisees themselves, and others are not. Leonard explained that there are pros and cons to both scenarios, but if the support person is dedicated to either helping you get the information you need or putting you in touch with someone who can, then his or her personal experience is less important.

The major benefit of a dedicated support person is that franchisees have a clear “point person” for any questions, and they can work with that person regularly, building rapport and working to solve problems together.

Another positive indicator is if a franchise hosts regular meetings with franchisees.

“If they are offering regional meetings with a group of franchisees, there’s a lot of information exchange,” Leonard said. “Even if you have a business coach who has never had ‘boots on the ground’ franchising experience — if you’re part of a roundtable or peer mentoring group — you can gain access to all of that firsthand knowledge.”

Leonard also recommends that prospective franchisees speak with franchisors about any exit planning that will be available when they choose to sell their business.

“I delve into this more in my book, ‘Your Franchise Fast Pass.’ You buy a business, you build the business, you see the growth, you’re at the end of your term — and what’s next?” she said. “Does the franchisor offer support or resources to assist with a business valuation? Many people go into business because they want to build a legacy with cash flow and exit successfully.” 

How Does Franchisee Support Impact the Decision To Expand to New Territories or Brands?

Experienced, successful franchise owners should still consider expansion opportunities carefully. Growing into a new territory or adding another brand to the portfolio can be beneficial, but it can also serve as a time and money suck if done prematurely.

“It is recommended to do your financial analysis, a high-level business plan to see whether it’s feasible and is the timing right,” Leonard said. “Maybe work with your business coach to think through things like, ‘Am I ready for this? Do I need this? Who is going to manage it?’ And you should consult with either a mentor, a financial advisor or a CPA to strategize working capital needs.”

Reflecting on the support you’ve received thus far or analyzing the support structures of a new brand should play into the decision-making process, but you should also seek franchisee support beyond your franchisor to ensure you are truly ready to grow.

“Whether it’s a franchise business or an independent business, all of the required systems to operate need to be in place,” Leonard said. While franchisors typically provide comprehensive support and training, it’s vital for prospective owners to understand both the offerings provided and the areas they may need to supplement independently.

Every great franchisee had help buying a franchise. Want to learn more about how 1851 helps franchisees find the right franchise opportunity? Visit www.1851growthclub.com and start your journey.