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Are You An Ideal Franchisee?

How do you quantify an ideal? It’s like the pursuit of perfection. It might be ultimately impossible, but the effort typically leaves you with the best possible outcome. In franchising, franchisors attempt to locate the best candidates for their systems by listing their specific qualifications.

The qualifying factors for franchises can be divided into three general categories: financial, business, and personal. The most obvious is the financial aspect. Can you afford to properly get the business started and run the business until it turns a profit? This is extremely important.  The #1 reason for new franchisee failure is “uncapitalization” – not having enough money. Remember when doing your research, the figures disclosed in the Franchise Disclosure Document are simply a guide. Everyone’s situation is different. Instead of the three months of working capital suggested, an incoming franchisee may need a year’s worth of funds saved in advance to take care of life and business expenses until the franchise is producing a livable wage.


The business category covers the straight-forward, more easily measured, skills a prospective franchisee brings to the franchise operation. How many years have you operated businesses? Do you have franchise-specific experience? Do you have sales experience?

What would come up in a background check? These things are covered in the personal category of the qualifications. Most often franchisors look for a clean criminal history, little to no litigation, and good referrals. The personal factors also cover the less quantifiable reasons. These qualifications are usually gauged during interviews during the franchise opening process. These qualifications typically include a visible passion for the brand or service, a community mindset, and more.

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