Franchising

The decision to purchase a franchise can be a very complex one.  You need to make an informed decision, based on an extensive fact-gathering process, to identify the ideal franchise for you.  One of the final steps of this process is to attend a Discovery Day.  

Franchisors hold Discovery Days, typically on a monthly basis, for potential franchisees to give them an opportunity to find out more about the franchise in an informal, no-obligation setting. During a Discovery Day, which is usually held at the corporate headquarters, the company defines the overall operation of the business, the product or service it provides, the training and support systems, and the financial investment required.

Despite the assumption that a Discovery Day is solely for the benefit of the potential franchisee, the franchise company itself also uses the occasion to develop first impressions of prospective franchisees and to informally assess their suitability for the business. So, it is the day for the management team and the franchise candidate to get to know each other on a deeper level than phone and email to decide if this is a good match for both parties. 

Also, it seems that the general consensus is that franchises are "purchased".  The vast majority of the candidates I consult with tell me that they wish to "buy" a franchise.  While technically you do have to pay the franchisor to become a franchisee, franchises are not "bought".  They are awarded to the individuals that franchise companies deem the best fit for growing their business.  Because of this, companies tend to be extremely thorough when investigating those who wish to represent their business.  There are many reasons that they need to be so selective and picky.  

The franchisor will be generating income (royalties) based on the income of the franchisee.  Therefore, the franchisor has a vested interest in the level of success of its franchisees.   

In addition, the overall reputation of the franchisor is at stake.  If a customer of one of its franchisees has a bad experience, it is reflected on the entire corporation, including all franchisees.  Word of mouth will spread unpleasant news at warp speed, and people will assume that the entire franchise is bad if a negative experience is had at one unit.    

Item 20 of the UFOC requires the corporation to list any franchises that have closed (failed).  Therefore, a company with any history of failed franchises will most certainly be unattractive to a potential new franchisee. 

The Discovery Day has several benefits to the prospective franchisee as well.  Discovery Day is a great opportunity to meet staff members of the corporate franchise team and, in some cases, existing franchisees in the network. You'll have a chance to ask any lingering questions you still may have in a casual atmosphere.  Keep in mind that you do want to sell yourself, and first impressions are vital, so present yourself as someone who will be a strong asset to the franchise.  Dress professionally, be confident, social, happy - excited about the opportunity!   

Demonstrate your knowledge of the industry and of the franchise. By now, you have done substantial research on the opportunity, so you should feel comfortable engaging in conversation relative to the franchise.  Franchisors will respect how educated you are about their business.   

You'll also want to convince them that you can follow their system.  They're not looking for someone who is entrepreneurial or super creative.  If you are someone who is constantly coming up with what you think are creative, brilliant ideas, you are probably not right for franchising.  It is imperative that you can follow a proven system.    

Lastly, if the franchiser doesn't already know, you must show that you are financially qualified.  You should already know, prior to Discovery Day, how you are going to finance the franchise and be able to demonstrate that to the franchiser.  He needs to know that you are more than capable of handling the investment, and will also have sufficient living expenses as you begin growing your business.  

Remember, you need to be adequately prepared for your Discovery Day. This means not only financially, but socially, as well as extremely knowledgeable of the company, product, and/or service. Finally, make this a fun experience. With proper preparation, you may very well end your Discovery Day as a new franchisee!  

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