The franchisee recruitment process

If you’re in the market for a franchise, you’ll find that franchisors tend to take a variety of approaches to the recruitment process – depending on their expansion goals and the level of demand there is for their franchise concept. You need to be aware of these factors as you make your enquiries.

Popular brands can afford to be choosy

A company with a popular brand, a profitable business model and happy existing franchisees will have a steady stream of people wanting to buy a franchise. For this reason, they can afford to be choosy. In fact, it is largely because they are choosy about who they let into their system that they have developed the reputation that makes them a sought-after business.

Other franchise companies with less well-known brands or new concepts will naturally attract fewer enquiries. This does not necessarily mean that their franchise offer is any less valuable. All successful franchise networks started as small, unknown entities. And getting in early can mean less competition and better returns. However, there will inevitably be greater risks when dealing with a less well-established franchise concept.

Watch out for desperados

As mentioned above, a franchisor’s recruitment practices will also be influenced by its expansion plans. Rapid expansion tends to be driven by two reasons. The first is a need to get as much market share as possible before competitors move in. For instance, a company may be moving into a new region and wants to quickly establish a critical mass of franchises to support a suitable marketing program. This is a legitimate reason for a franchisor to want to sign up as many people as possible as quickly as possible. However, franchisors with this motivation will still tend to be fussy about whom they choose.

The second reason for rapid expansion is to fund the franchisor’s business through the sale of franchises. This is a dangerous and misguided approach that inevitably leads to a lowering of recruitment standards. A small, unknown franchisor that is undercapitalised raises the already higher risks for its franchisees.

Investigate the process

Once you have shortlisted a franchise system of interest to you, find out the franchisor’s recruitment process and why they take this approach. For instance, after identifying yourself and your credentials, you could respectfully ask: “Could you please tell me your requirements for a prospective franchisee and how your recruitment process works?”

While this may seem an intrusive question, most reputable franchisors will treat your question as evidence that you are an astute businessperson and will be pleased to briefly explain their approach.

Measure twice, cut once

My advice is to treat the franchisee recruitment process similar to if you were choosing a business partner. Buying a franchise is not like applying for a job, nor is it like buying a product. You may, at times, feel intimidated by the process – particularly if formal assessment processes are involved. Resist the temptation to exaggerate your strengths or your assets, or to make yourself out to be something you are not. This will backfire on you. Guaranteed.

You are looking to run a business where you will be totally responsible for what happens. A franchise is not like a job where you can just walk away if you are not achieving the results that you expected.

There is more information available regarding Franchise Council of Australia is a not for profit membership organisation that is the peak body representing the franchising sector in Australia.