How to Identify, Analyze, and Execute Practical Managerial Solutions to the problems and Opportunities of Acquiring a Franchised Business

Question 1

What are the 10 key factors to consider when evaluating a franchise?

Answer 1

1.Market conditions
2.Company history
3.Financial stability (Article 21 of the FDD)
4.Investment level
5.Training & support
6.Territory rules (Article 12 of the FDD)
7.Royalties & fees (Article 6 of the FDD)
8.Restrictions (Article 8 of the FDD)
9.Personal suitability
10.Exit strategy

Question 2

*Helps understand the local market and competition
*Identifies target audience and future growth trends
*Provides insights into customer demand and potential risks

Answer 2

Market Research

Question 3

What are the steps in evaluating potential franchisees?

Answer 3

1. Application & Screening
2. In-person interviews
3. Reference checks
4. Financial Due Diligence
5. Discovery Day or Franchise Expo
6. Business Plan Assessment

Question 4

How can franchise businesses maintain consistency across locations?

Answer 4

1.Provide clear operational guidelines
2.Offer continuous training & support
3.Conduct regular evaluations
4.Use technology for standardization

Question 5

What are the key challenges in managing a franchise?

Answer 5

1. Hiring & Retaining Employees
2. Maintaining brand consistency
3. Adapting to Market Trends
4. Legal Compliance
5. Financial Management

Question 6

How can franchises adapt to changing market trends?

Answer 6

1. Stay Flexible & Innovative
2. Use customer feedback & market research
3. Maintain good franchisor-franchisee communication

Question 7

what are some key financial management issues in franchising

Answer 7

1. Managing royalty payments & marketing budgets
2. Ensuring franchisees remain profitable
3. Balancing franchisor-franchisee financial interest

Question 8

what is the purpose of an exit strategy in a franchise?

Answer 8

1. Provides a clear plan to sell or leave the business
   2.Helps manage unexpected situations (illness, financial issues, etc.)
   3.Reduces financial losses and legal complications

Question 9

What support systems should franchisors provide?

Answer 9

1.Training programs
2.Marketing & branding support
3.Operational & financial guidance
4.Technology & digital tools
5.Legal & compliance assistance

Question 10

What role does technology play in franchise management?

Answer 10

1. Helps standardize operations
2. Improves customer experience
3. Supports marketing, sales, and reporting
4. Enables better communication between franchisees & franchisors