{"id":29242,"date":"2019-01-08T22:21:41","date_gmt":"2019-01-08T22:21:41","guid":{"rendered":"https:\/\/www.thefranchiseking.com\/?p=29242"},"modified":"2022-04-28T20:23:19","modified_gmt":"2022-04-29T00:23:19","slug":"10-commandments-franchise-research","status":"publish","type":"post","link":"https:\/\/www.thefranchiseking.com\/10-commandments-franchise-research","title":{"rendered":"These Are The 10 Commandments of Franchise Research"},"content":{"rendered":"

\"the<\/a><\/p>\n

First off, I hope you won\u2019t be too disappointed if I don\u2019t use the word \u201cThou<\/em>\u201d in this post about the most important part of the franchise purchasing process<\/strong>.<\/p>\n

Secondly, I realize that the word, \u201cCommandment<\/em>\u201d is a powerful one. As in \u201cI command you to<\/em>…\u201d<\/p>\n

That said, if you\u2019re uncomfortable being told what to do (by someone who knows way more about how to do powerful franchise research<\/a> than you do<\/em>), you\u2019re more than welcome to substitute a kinder, gentler word as you read through my “10 Commandments Of Franchise Research<\/strong>.” (My 10 franchise research tips<\/em>)<\/p>\n

For example, you can use \u201csuggest.\u201d<\/em> Or \u201cencourage<\/em>.\u201d<\/p>\n

But know this:<\/strong> the ramifications of doing it like that will be huge.<\/p>\n

To put another way, if you want to reduce your financial risk<\/a>, you must<\/strong> do the following 10 things when researching franchise opportunities. Or face the consequences, which includes losing your money, a potential hit on your credit score, and the embarrassment you\u2019ll feel when you go out of business<\/a>.<\/p>\n

The 10 Commandments of Franchise Research<\/h2>\n

I encourage you to read every Commandment, so you can begin researching franchise opportunities the right way.<\/p>\n

    \n
  1. Never attempt to research franchise opportunities until you learn exactly how to do it<\/strong><\/li>\n<\/ol>\n

    Bluntly, if you\u2019ve never been taught how to do first-rate franchise opportunity research, you don\u2019t know how to do it.<\/p>\n

    \u201cJoel, I\u2019m sure I\u2019ll be able to figure out how to do franchise research. I\u2019ve done research on a lot of things in my life<\/em>.\u201d<\/p>\n

    Nope. That doesn\u2019t fly. You don\u2019t<\/strong> know how to do this<\/em>. And it doesn\u2019t matter how smart you are.<\/p>\n

    \u201cThe saying goes, \u2018if you fail to prepare, prepare to fail\u2019, but if you are preparing for something you have never done before, no matter what your other experience might be, often the most efficient and effective method of preparation begins with relying on experts. This saves you time, money and provides wise counsel<\/em>.\u201d<\/p>\n

    \"business<\/a>
    \n–     Carol Roth<\/a>, Creator of the Future File Legacy Planning System, \u201cRecovering\u201d Investment Banker and New York Times Bestselling Author.<\/p>\n

      \n
    1. Do not research franchise opportunities quickly<\/strong><\/li>\n<\/ol>\n

      If you end up purchasing a franchise, it will end up being one the largest investments you’ll ever make. That’s why you need to make sure you do your research slowly and methodically.<\/p>\n

      Why does this matter?<\/strong><\/p>\n

      Because if you rush through your research, I guarantee you\u2019ll miss something important.<\/p>\n

      Remember, once you sign a franchise agreement, there\u2019s no going back. You\u2019re committing 10 years (on average<\/em>) of your life to the franchise business opportunity. You need to make sure it\u2019s the right one for you…and<\/strong> for your area of the country.<\/p>\n

        \n
      1. Always research competitors<\/strong><\/li>\n<\/ol>\n

        Don\u2019t put all your eggs in one basket.<\/p>\n

        That means that even if you\u2019re in love with a particular franchise opportunity, make sure you scope out their competitors.<\/p>\n

        In this case, that means to contact at least one competitor<\/strong>, request franchise information from them, and go through their process. You never know…they could end up being a better, more profitable franchise business<\/a> for you. And besides, what if your first choice in a franchise turns out to be not<\/em> such a good choice after all.<\/p>\n

        \"google\"<\/a><\/p>\n

          \n
        1. Create Google alerts<\/strong><\/li>\n<\/ol>\n

          Whenever you\u2019re interested in a specific franchise opportunity, immediately create a Google alert. That way, whenever the franchise is mentioned online, you\u2019ll know.<\/p>\n

          Google alerts generally include everything from press releases, to rating and reviews, along with news items about the brand. Here\u2019s how to set one up<\/a>.<\/p>\n

          For example, if you\u2019re interested in Firehouse Subs, and you create a Google alert for \u201cFirehouse Subs Franchise<\/em>,\u201d one day you may get an alert in your inbox with a subject line that reads, \u201cNorth Carolina businessman signs 10-store franchise agreement for Firehouse Subs<\/em>.\u201d<\/p>\n

          Of course you may end up getting a Google alert about a franchise lawsuit<\/a>…but let\u2019s not go there.<\/p>\n

            \n
          1. Be nice to Franchise Development Representatives<\/strong><\/li>\n<\/ol>\n

            Franchise Development Representatives have a job to do, and that job is to sell franchises. And every time they sell a franchise they get paid a commission.<\/p>\n

            In a nutshell, everything they do is an attempt to lead franchise candidates (you<\/em>) closer to a deal.*<\/p>\n

            *In this case, a \u201cdeal<\/em>\u201d is a signed franchise agreement along with a check for the upfront Franchise Fee<\/a>.<\/p>\n

            So, knowing this…why would you want to be nice to them? After all, in their minds, all you are is just another \u201ccandidate<\/em>.\u201d<\/p>\n

            Answer:<\/strong> Because if they don\u2019t like you, you won\u2019t be able to buy the franchise opportunity<\/a> they represent.<\/p>\n

            Now, you don\u2019t have to kiss their butts.<\/p>\n

            If they aren\u2019t cooperating the way you feel they should be, if they aren\u2019t answering your research questions, call them on it. Just do it nicely.<\/p>\n

            Because when it\u2019s all said and done, they want<\/em> you to buy a franchise.<\/p>\n

            Recommended read: Working with Franchise Salespeople<\/a><\/p>\n

              \n
            1. Do not worship false franchise gurus<\/strong><\/li>\n<\/ol>\n

              Your franchise research, especially the online variety, may lead you to a few dark places. One of them: Amazon.<\/p>\n

              For instance, suppose that you\u2019re researching franchise opportunities, and you type \u201chot franchises<\/em>\u201d or \u201camazing franchise opportunities<\/em>\u201d into the Google search bar…just to see if you can maybe get lucky and find one or two franchises that look like winners.<\/p>\n

              Then-as luck would have it, you learn that there\u2019s an entire book about \u201camazing<\/em>\u201d franchise opportunities. So you buy it, and you’re one excited person. Heck, you may find an amazing franchise to own. And the book was only $7. You\u2019ve got nothing to lose.<\/p>\n

              Wrong!<\/strong><\/p>\n

              You better read this<\/a>. It\u2019s about a book and a franchise guru gone bad.<\/p>\n

              One more thing: If someone calls themselves a “franchise consultant,”<\/a> it doesn’t mean that they are a franchise guru. So check their credentials.<\/p>\n

                \n
              1. You must not fall for franchise marketing buzzwords<\/strong><\/li>\n<\/ol>\n

                Please…I beg of you, don\u2019t go back in time…back (in the 80’s<\/em>) when Entrepreneur Magazine\u00ae, and a couple of \u201cMoney-Making Business Opportunities<\/em>\u201d rags were the only ways to find out about franchises for sale…back when franchises were more of a \u201cthing<\/em>.\u201d Back when more and more people were becoming interested in being their own boss.<\/p>\n

                Two Important Things to Know About That Time<\/strong><\/p>\n

                A. The government wasn\u2019t very focused on the franchise industry<\/p>\n

                B. Marketers were<\/p>\n

                “B<\/em>” is one of the reasons that phrases like \u201cBusiness in a Box<\/em>\u201d and words like \u201cturnkey<\/em>\u201d started to become commonplace. And they\u2019re still being used today.<\/p>\n

                Now, to be sure, they\u2019re great words.<\/p>\n

                For example, who wouldn\u2019t<\/em> want to own a \u201cturnkey<\/em>\u201d business?<\/p>\n

                In like manner, wouldn\u2019t you want<\/em> to buy a \u201cBusiness in a Box<\/em>?\u201d<\/p>\n

                But the thing is, \u201cturnkey<\/em>\u201d businesses don\u2019t exist.<\/p>\n

                Same goes for a \u201cBusiness in a Box<\/em>.\u201d<\/p>\n

                But the words do. Still<\/em>.<\/p>\n

                Important Franchise Research Tip:<\/strong> Click the Book Cover!<\/strong><\/p>\n

                \"the<\/a><\/p>\n

                  \n
                1. Do not visit local franchisees<\/strong><\/li>\n<\/ol>\n

                  Sometimes, your best intentions can lead to problems. Case in point: Visits to local franchise businesses for research purposes.<\/p>\n

                  For instance, if you\u2019re interested in learning more about The UPS Store<\/a>\u00ae, in your mind, it makes total sense to stop into one of their local stores for a little look-see.<\/p>\n

                  Better yet, while you\u2019re there, you feel that it would be a fine idea…a brilliant one actually, to talk with the franchisee.
                  \n                  \"do<\/a>
                  \nDon\u2019t do it.<\/p>\n

                  Let me rephrase that.<\/p>\n

                  Do not visit a local franchise owner until it\u2019s the appropriate time<\/strong>.<\/p>\n

                  As in, not until you have a deep understanding of their business model, have had extensive conversations with the Franchise Development Representative, and have talked with several franchisees.<\/p>\n

                  The reason: you\u2019ll look like foolish. You\u2019ll come across as an amateur who\u2019s \u201cjust snooping around<\/em>.\u201d<\/p>\n

                  Another Problem<\/strong><\/p>\n

                  There\u2019s another potential problem with visiting a local franchisee too early in the process.<\/p>\n

                  You may get her paranoid. She may start thinking that another franchisee is moving in, and that this franchisee could take some of her customers. (Even if it\u2019s not even remotely true<\/em>)<\/p>\n

                  The bottom line?<\/strong><\/p>\n

                  Don\u2019t invent your own process. Doing so may have some unintended consequences.<\/p>\n

                    \n
                  1. Call at least 10-15 existing franchisees<\/strong><\/li>\n<\/ol>\n

                    Without exception, the best resource to get answers to your most burning questions about the franchise opportunities you\u2019re looking at are the franchisees. After all, they\u2019ve already invested their own money in the franchise, and know, first-hand, how things are going with the brand and their own businesses.<\/p>\n

                    Caution!<\/span><\/h3>\n

                    \"franchise<\/a><\/p>\n

                    As you do your franchise research, there\u2019s a slight possibility you\u2019ll run into people who don\u2019t<\/em> think you should talk to existing franchisees. That\u2019s because they don\u2019t feel they can be trusted to tell the truth. Why…I don\u2019t know. It\u2019s really bizarre. A total conspiracy theory<\/em>. Maybe it\u2019s something in their water<\/a>.<\/p>\n

                    Tip:<\/strong> Ignore that ridiculous advice. Call franchisees<\/strong>. If you approach them correctly, and ask them good questions, you\u2019ll get the answers you need to make a smart choice in a franchise to own.<\/p>\n

                      \n
                    1. Do not visit franchise headquarters<\/strong><\/li>\n<\/ol>\n

                      To be exact, do not visit franchise headquarters unless you\u2019re serious about buying that franchise<\/em>. And what do I mean by \u201cserious<\/em>?\u201d<\/p>\n

                      Serious franchise buyers:<\/strong><\/p>\n