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Posted 15/07/2023 in Franchising

Ready to Dive into Franchising? Insights from a Franchisor's Perspective

Ready to Dive into Franchising? Insights from a Franchisor's Perspective

If you're considering operating a franchise, you might have come across terms like "Franchise Recruitment" or "Franchise Development." These refer to the process where franchisors carefully assess potential franchisees to ensure a mutual fit between their business model and the candidate's credentials.

During your due diligence, as you gather information about the franchise, the franchisor will also have several questions for you. They often provide questionnaires and hold multiple meetings to determine if you align with their brand and business philosophy.

Before granting a franchise and handing over the keys, most franchises conduct a qualification process. This process is crucial, as franchisors seek positive individuals who can represent and manage their brand effectively. As a franchisee, you become a business partner, and a strong partnership is essential for franchise business success. The franchisor's reputation is at stake, so is yours, and they want new franchisees to thrive and be profitable.

Key Factors Considered by Franchisors:


Undoubtedly, this is a critical factor in the qualification process. Franchisors usually have specific minimum net worth and liquid capital requirements. Beyond just affording the franchise fee and startup costs, additional cash on hand is essential to cover living and business expenses during the initial start-up phase of building the business. Avoid starting with heavy debt, as it could add to your outgoing costs.


While franchises provide training and support, having some business acumen is beneficial. Understanding principles such as COGS (Cost of Goods Sold), wages, cash flow, and financial management will give you a solid foundation. Other skills, like managing people and following franchise systems, can be learned while operating the franchise.


Surprisingly, franchises often prefer candidates with no prior business ownership experience. Why? Because most franchises offer extensive training, making it easier to teach their systems and methods to newcomers. Your overall life experience and personal growth play a crucial role in making you an ideal franchisee and business operator.


The most successful franchisees share certain common traits: the ability to get along with and manage people, a strong work ethic, exceptional problem-solving skills, a can-do attitude, and a willingness to follow the franchise's procedures and systems. If you prefer doing things your own way and aren't keen on adhering to established systems, franchising might not be the right fit for you.

Key Points

Remember, every franchisor's primary goal is to ensure the success and prosperity of their franchisees. Reputable franchises are fully invested in helping you achieve your business goals.

Be cautious of franchises that don't ask tough questions or provide in-depth training. Such companies may not be serious or supportive when it comes to helping you succeed in your business venture.

Updated: July 26, 2023