Ask the franchisor, and ask yourself - planning

Nation's Business, Oct, 1988 by Meg Whittemore, Andrew J. Sherman

Ask The Franchisor, And Ask Yourself Before you make the commitment and buy a franchise, be sure you know your strengths and weaknesses as well as your prospective franchisor's.

Obtain answers for the following questions:

. How many years has the franchisor been in operation?

. Check the legal papers.

Is the Uniform Franchise Offering Circular thorough?

Does it describe the people in charge of the franchise--the full management team, board of directors or home management team--along with their experience? Does their experience relate to this industry? Does it relate to franchising?

. What support services will you receive in opening up for business? How long is the training program, and how often is it updated? Will you receive more training after you open? Is the operations manual clearly written? Is a field support staff available to visit and periodically assist franchisees?

. What are the franchisor's estimates of your initial and ongoing costs and expenses? Are these figures realistic in your market?

To what extent are equipment specifications and quality-control standards imposed on the products and services that are needed for operating the business? Can equipment and supplies be purchased from a source other than the franchisor? Under what conditions? Does the franchisor have a supplier program?

. What is the litigation history of the franchisor? Have disgruntled franchisees brought lawsuits, or have suits been initiated by the franchisor to protect the trademark or weed out poorly performing franchisees? Does the franchise have a recognized, protected and distinctive trade identity? Are the franchise locations uniform in appearance?

. Has the franchisor investigated you carefully enough to be sure that you can successfully and profitably operate a franchise?

. What are the terms and conditions for terminating the franchise relationship? How many franchises have been ended during the past few years? How many franchisees have failed?

. Have you talked to randomly selected franchisees about the franchisor's support services and overall business?

. Did you have the contract examined by an attorney who understands franchising, antitrust laws, trademark laws and the Federal Trade Commission Franchise Rule?

. Are you good at following instructions, or do you tend to be independent-minded?