We are continuing on from our last episode where we're talking about the questions that you should be asking during the due diligence phase of talking to other franchisees while evaluating that franchise.
In our last episode, we talked about history and competency. We're going to go through competitiveness questions today. Competitiveness is a really crucial topic. We'll give you some firsthand insight into competitiveness in our own franchise. So there are a couple of questions that we think are important here to ask. So I'm going to ask Stacey, she's going to answer, and she's going to give you why we believe this is such an important question to ask. That's what we're doing. So here we go Stacey.
Questions 1: what do you believe is the most valuable part of the franchise system in helping you to effectively compete?
Well, in our coffee smoothie business, I think what our franchisor did best was understanding the particular business model that they were in, which was events and fairs and festivals. They really got that. They were the leader in the industry, they had good name recognition and they had a fantastic product. Now, would I turn that around and maybe ask the opposite? What were they not so good at? I think that's really an important question to ask. And we do talk about this in a previous What's Your Next Podcast where we give you the questions to ask of the franchisor. So make sure you go back and, and watch that episode. But I think it's important to know maybe also what they do well, but what they don't do so well because our franchise had some of those on the checklist, things that they didn't do so well that we didn't know going in.
So let's talk about the franchise brand just for a moment. This is where you could be getting at that brand question. And in our franchise, they had a terrific product. I mean, it was by far the best at the time. We believe it was the best product on the market, is a high-quality product that tasted unbelievably delicious. The issue is that our competitors were massive. I mean, you know, we're talking about the S we're talking about the M we're talking about DD. Everybody was getting into this same industry and we had to compete with these particular organizations, which when you don't have the brand recognition, the franchisors have to have the marketing in place to help you. I think this is one thing that is really important if it's an emerging brand in an industry that's truly very competitive, you need to make sure you're getting some marketing support. So that's my kind of addition to what you had said.
Question number two on competitiveness: what do you think are the key advantages and disadvantages the franchise has over its competition?
So in our coffee/smoothie franchise, I think had an advantage in that they were leaders in the event space, but they weren't leaders in the brick-and-mortar space. So that would be a big disadvantage. An advantage was they had a great product, but another disadvantage was they didn't have great distribution. So as you're talking to franchisees, listen to what they say and how they answer the question and ask them to elaborate; read between the lines and understand what they're getting at. Dave is giving you a lot of questions here to ask, but also I also wanna pre-frame this by saying, be respectful of somebody's time when you're talking to them. I would encourage you to leave these interviews for maybe 10 minutes. And then if a franchisee is willing to give you more time, great, but don't go in expecting them to give you like an hour and a half of their time to share about their franchise experience.
Although most of them will because in most cases they were chosen by the franchisor and kind of prepped already on how to be a good reference for them for doing due diligence. So if you're going to get the time I would dig deep when you get into these topics. If you feel like there's something that they want to say to you, but they haven't said it, you need to get to that information. You need to find that out because I agree with Stacey, some of the things that we didn't get were pain points like what distribution challenges are there. Watch one of our other episodes and you'll understand the “would we do it all over again”? You will get some first-hand pain we went through after we had gotten into the franchise. I think that what's important here is we're giving you our own experience here, although It's going to be very different from franchise to franchise. So you really want to make sure that you get clear answers to these questions. And if you don't, ask them to elaborate.
Let me say also, that I think that it is so important why you should work with someone like us as a franchise placement matchmaker specialist. That was a lot of words, but you want to work with someone like us because you're not just going to one day, miraculously end up talking to a franchisee doing due diligence. You're going through a process and we will be with you all along that route as you’re learning more about the franchise concept. Determining if you could be a good fit for it, there are going to be a lot of things that come up as pros/cons. And there might be a few things that you're going to be questioning or want some more deep-dive answers or more elaboration on. When you get to the point of doing your due diligence and talking to franchisees, we can help you get more specificity on the questions that you really should be asking that franchisee.
These are the top questions we are giving you are generic to open up the conversation. We are going to end this episode with that. If you'd like a copy of this questionnaire: questions to ask franchisees please just click on this link and ask us to send you a copy.
What's Your Next? - Podcast
 | Author BioI’m Stacey Riska aka “Small Business Stacey”, your franchise placement specialist. I help aspiring business owners find the PERFECT franchise so they can get to the next level in life and business. |
