Franchisee checklist - assessing the business type
| The franchise | Yes | No | |
| 1. | Is this a genuine business format franchise? (It could be a product distributorship or agency which is not really a franchise but is promoted as a business format franchise and should therefore be treated with caution). | ||
| 2. | Has the franchised business been thoroughly proven in practice? | ||
| 3. | If it is an overseas franchise how successful has it been in its own and other markets? | ||
| 4. | Is there a strong, distinctive trade name associated with the product or service? | ||
| 5. | Is there an awareness of the brand in the country or state in which you want to locate it? | ||
| 6. | Are the franchise's prices competitive and can this competitiveness be maintained? | ||
| 7. | Is there adequate back-up in terms of guarantees and service facilities? | ||
| 8. | Is the product or service new? | ||
| 9. | If there are competitors, has the product or service any distinct advantage over theirs? | ||
| 10. | Are the products produced by a patented method or is the service based on an exclusive process? | ||
| 11. | Is the product/concept defendable, ie how vulnerable is it to imitation and/or competition? | ||
| 12. | Is the source of supply of products or materials guaranteed in the future? | ||
| 13. | Has the product or service and general business concept long-term market appeal or could it be a passing fad or fashion? | ||
| 14. | If the franchise is being newly imported from abroad will it hold a similar appeal in your market? Has it already been tested there? | ||
It is important when you are assessing a franchise operation not to simply accept that financial results or projections from one area will automatically be repeated in your chosen location. A franchise that works well in Chicago or London may not be successful in Sydney or Toronto. Carry out your own market research to satisfy yourself before making the investment.