How to Buy a Franchise: Validation Process

One of the last steps you should take before you commit to investing in a franchise is talking with current and former franchisees. This step, known as the validation process, will provide you with valuable insights and a better understanding of the franchise system. 

In this episode of the “How to Buy a Franchise” Masterclass, 1851 Franchise publisher Nick Powills elaborates on how you can approach the validation process. 

The Validation Process

The validation process is a crucial phase in your journey, as it enables you to gather firsthand experiences from individuals who have been directly involved with the franchise. It essentially acts as a reference check for prospective franchisees and allows you to hear about the real-world experiences of entrepreneurs who have taken the same journey you’re now on. Through these conversations, you can gain a deeper understanding of the franchise system’s strengths, potential challenges, and overall suitability for your goals. 

“This is, in my opinion, the most critical aspect of the yes or no for you, the franchisee,” said Powills. 

Getting Started

Getting in touch with these franchisees is a straightforward process that typically begins with reaching out to the franchisor directly. Franchisors understand the importance of the validation process and are, for the most part, willing to facilitate your communication with current and former franchisees. 

We recommend that you request contacts within your state and specifically inquire to speak with franchisees at different performance levels, including those with lower earnings, middle-performers and top earners. As mentioned, you will also want to speak with former franchisees who have since exited the system. Knowing the reasons and challenges that former franchisees have experienced can also help illuminate any potential pitfalls and areas of concern within the system. By taking this approach, you should get a well-rounded perspective on the system. 

What to Ask 

Before reaching out to franchisees, it’s essential to have a well-thought-out plan for the questions you intend to ask. To assist in your journey, we’ve compiled a list of pertinent questions to help guide the conversation: 

• How did the buy-in process unfold?
• Is there anything you wish you knew back then that you know now?
• Did the initial cost align with your expectations?
• Are you achieving the financial outcomes you anticipated?
• What do you wish you’d done differently?

Lastly, one of the most revealing questions to pose is, “Would you choose to do it again?” These questions serve as valuable tools to assess the franchise’s strengths and weaknesses, allowing you to weigh the pros and cons effectively as you consider your options. 

“Validation ends up being deeply critical. You have to see yourself living a day in the life of a franchisee,” said Powills. 

Are you in the process of seeking out franchise opportunities? We can help! Check out https://1851growthclub.com/ for more information.