Becoming a franchisee: A complete guide

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Becoming a franchisee: A complete guide

Becoming a franchisee is an attractive proposition for many business-minded individuals who dream of managing their own organisation. When considering the possibility of entering into a partnership with a franchisor, it's important to prepare yourself in a number of different ways. Here, we take a look at five ways you can get franchisee ready and give yourself the best possible chance of success in your future business venture.

Understand the franchisor-franchisee relationship

When first considering becoming a franchisee, its vital that you explore the franchisor-franchisee relationship and understand exactly how it manifests itself in reality. Its often the case that would-be franchisees have certain preconceived ideas of what this relationship will look like without having accumulated any first-hand experience. Becoming a franchisee can differ drastically from running a small, independent business and individuals need to be aware of the possibilities and limitations inherent to the franchising system.

Most importantly, potential franchisees should understand that their role will be strictly defined and that their ability to diverge from standard practices and regulations will be limited. In almost all cases, the franchisor will put in place procedures, processes and rules that the franchisee will be expected to follow. For the franchisor, this protects the franchise brand and ensures that the same standards are maintained across all franchise outlets and that the business runs smoothly. For the franchisee, it provides a framework to work with and a pre-existing, efficient organisational structure. However, it does also mean that the scope for individual creativity is more limited.

Still, the franchise system does not prevent a talented and hard-working franchisee from succeeding. Instead, it means that only a particular type of business owner will prosper. If you have no problem abiding by a franchisors specific procedures and regulations and have the management, organisational and motivational skills necessary to operate a small business, a franchise could be an easier and potentially more lucrative option that starting an independent business.

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Choose your sector

Franchises operate in almost every sector, from financial services and estate agency to retail and pet-sitting. You may be at a slight advantage if you start a franchise unit in a sector youre already familiar with perhaps you have previously owned a restaurant or been employed in a van-based business. But this doesnt mean you have to continue on a set career path. Most franchisors offer a set training scheme for new franchisees, so youre equipped with all the tools and skills needed to launch a successful business.

Of course, you should lean towards franchises that you are passionate about and prepared to work hard at. Theres no point setting up a dog-sitting business if you love animals but arent prepared to walk them in all weathers, wash them and care for them for days on end.

Research franchises operating methods

Although it may seem obvious, dont underestimate the importance of researching different franchise systems and franchises in depth. Although weve made generalisations about the franchise system as a whole, each franchise will have its own unique characteristics and establish itself in a slightly different way, depending on their product offerings and the industries they belong to.

Typically, being passionate about your chosen professional field will be helpful when setting up a franchise and ensuring that it remains successful year on year. However, this will not be enough on its own. Franchises differ depending on their operational methods - for instance, a franchise may sell the vast majority of its products via phone sales, so youll need to make sure you are well suited to it. No matter how interested you are in your chosen field of business, if you arent comfortable or capable of selling your product via the franchisors preferred methods, problems will probably crop up.

These variations in the franchising system mean that to prepare yourself adequately, extensive research into various franchises and their preferred business practices is essential. This research can take multiple forms, but potential franchisees should try to speak to existing franchisees if possible, visit a franchise show and ensure they look beyond superficial success stories. Readying yourself for opening up a franchise involves digging deep for as much franchise information as you can not only so you know whether its the right franchise for you, but also so you have an idea of what has gone well or badly for its franchisees in the past.

Explore the costs

While its easy to find concrete start-up figures for most franchises, the numbers youll be given are usually a minimum cost that includes franchising, training and equipment fees. On top of this, a large marketing budget will probably be required to get the franchise off the ground. The real cost of becoming a franchisee isnt set in stone and individuals hoping to open up a franchise will need to give themselves a little breathing room to get started. To adequately prepare yourself, take a look at how much you're realistically going to need to get the business off the ground.

This often involves performing a thorough cost analysis and making sure you have the required funds to keep you going until the franchise begins turning over a profit. Not all franchises will make a profit immediately and many will take up to six months or even a year to reach a place of financial security and profitability. Potential franchisees need to prepare themselves financially and mentally for this eventuality. While it can take time to achieve this level of preparation, youre more likely to be successful once youre established if youve taken this vital step.

Assess your own strengths and weaknesses

Once youve researched potential franchises and franchise models and explored their advantages and disadvantages, its time to turn your attention towards your own strengths and weaknesses. Impartially assessing your own talents can be a challenging task. However, it's essential if you're to give yourself the best chance of success.

Franchisees can come from any background and have any professional history, but there tends to be a certain type of individual that flourishes within the franchise system. While particular skills and talents will be better suited to specific industries and franchises, all franchisees need to be able to work within the existing franchise structure. This means following strict protocols and running your business according to others' wishes, demands and ideas.

As a franchisee, youll be in charge of a small business thats part of a much larger organisation and sometimes will be forced to put the interest of the entire franchise before your personal interests. If youre willing and able to do so, you should ensure your personal strengths and weaknesses make you well-suited to your chosen franchise.

Meet the franchisor

It's usually a good idea to meet face-to-face with potential franchisors before you make a choice and commit to one in particular. While everything can look perfect on paper, the franchisor-franchisee relationship is a close one, and you need to be completely sure that you're going to be able to work with the organisation supporting you.

This is the time to ask questions, gather all the information you can and get a feel for how the franchise interacts with franchisees, what it expects of franchisees and what you can expect of your franchisor. As youll be working hand-in-hand with the franchisor, its vital that you understand their business culture and feel as though you could operate efficiently as part of it. A good franchise opportunity will be one that works well for both parties.

Meet everyone else

Many franchises run discovery days for prospective franchisees. This is the perfect opportunity to really get a feel for the way the business operates. Youll probably be able to visit the franchises headquarters and meet existing franchisees. If the franchisor organises this, its a good sign. Franchisors that try to stop you from meeting and talking to other franchisees usually have something to hide. Its likely their financial projections are exaggerated or they dont provide as much franchisee support as they claim to.

By meeting other franchisees, you can verify any claims the franchisor has made. You should also ask them how they found the experience of becoming a franchisee, and whether they would recommend it. They have no reason to lie to you, so take this opportunity to work out whether the franchise opportunity is for you.


When it comes to franchising, knowledge is power. A well-informed franchisee will be prepared for almost any eventuality and have a comprehensive understanding of what is and isnt possible within the system.

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