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Franchise questions required for evaluating a franchise

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Below are some questions to ask the franchisor to help you assess their Australian franchise opportunity. Remember that there are many types of franchises in Australia and so you may have to adjust the questions to suit the specific franchise you are enquiring about.
  • What are your long-term plans for improving your franchise business?
  • Do I have to pay a deposit or upfront payment, and if I do not proceed will I lose my deposit or any part of it?
  • How long will it take to start trading from the time I sign the contract?
  • How much working capital do you think I need, and what help can you give me in estimating my projections?
  • What will the training consist of, how long will it last and are all training costs included in my franchise fee?
  • What is my expected break even and how long should it take me to reach this figure?
  • Do you charge ongoing franchise fees and if so what are they and how are they calculated?
  • Do I have to contribute to any other costs such as advertising and promotional expenditure that you incur, if so how much?
  • What help, if any, will I receive if I want to do some advertising and promotion on my own?
  • What help and guidance do you offer in finding the right site in Australia?
  • After I have opened, what ongoing support will I be provided with?
  • Do you provide instructional and operational manuals and can I see them prior to signing?
  • Have any Australian franchisees failed, and if so why?
  • How many franchisees do you aim to have in Australia and internationally in the next 5 years?
  • How thoroughly do you vet prospective franchisees to maintain a high standard in the network?
  • Will the territory offered be for my sole and exclusive use?
  • Are you currently operating in areas in Australia with similar demographics as my proposed territory?
  • How do you handle grievances with existing franchisees?
  • Does your company see any threats in the current Australian marketplace?
  • What do you do for your franchisees that your competitors don’t?