Important Questions to Ask Before Investing in a Franchise

You’re likely eager to jump right into your franchise business, but several important questions should be taken into consideration before doing so. Spend time sitting down with the franchisor (or a handful of franchisors if you’re debating which franchise to open) and franchisees who have experience with the specific restaurant you’re looking to open.

Questions for the Franchisor

  • How much total investment will the franchise require upfront?
  • What financing options are available?
  • What are the rules/requirements of opening this franchise?
  • How much does it cost to maintain the franchise once it’s up and running? (monthly/annually)
  • What are the average franchisee profit margins across the franchise?
  • What is the average success rate of franchises in this chain/location, etc?
  • How many franchise locations does the average franchisee open?
  • How many employees will I need to hire to support my business?
  • Who do I reach out to if I have a question about my franchise?

Questions for the Franchisees

  • What are the pros and cons of working with the franchisor?
  • What does the franchisor do to support you after they’ve awarded you their franchise?
  • What did you take into consideration when deciding location(s) for your franchise?
  • What location factors contribute to the success of your franchise?
  • How long did it take your franchise to break even?
  • What training will be required to get employees up to speed?
  • What does the day-to-day look like for a franchise owner?