It pays to do your research (Daily Mail franchise story)
posted on 23-Jul-2008
THERE'S more to researching a franchise than talking to the franchisor.
Research your sector, picking likely franchises. Check you have the right skills and investment, and draw up a shortlist for closer research.
Google the company name. Sometimes franchisees complain on internet forums. Lots of complaints? Steer well clear. Google the names of directors. Are they what they seem? 'Check whether it is a member of the British Franchise Association (BFA),' advises Chris Gillam of Kyros, which matches franchisees to franchises. 'The BFA is a self-regulatory body whose members agree to abide by a code of ethics.' See the British Franchise Association's website for a full list of approved franchises.
Check the company's bonafides at www.companieshouse.gov.uk. Basic information is free, but you can pay to find out more, such as whether companies have filed accounts late.
Become a mystery shopper to try the service or product.
At your first meeting with a company, Mr Gillam says: 'Ask the franchisor for a list of existing franchisees and permission to contact any.
If there is hesitation, be suspicious.' Ask for a copy of the company's accounts. BFA members commit to disclosing facts such as directors, annual number of openings and failures.
The franchisor will be investigating you, too, so take documents to back up your claims..
