By Kerry Pipes

Getting to know a little more about you as a prospect is one of the first things franchises are interested in. The initial franchise application process is a screening mechanism by which franchisors begin to determine your interest and qualifications.

Today, it is common to find initial franchise application forms on franchisors’ websites – but most will be happy to send you one as well. This is a good stepping off point for beginning the communication process. You should not only take this very seriously, but also expect to spend some time gathering the information and completing the application.

Most franchise applications include many of the same requests for information, and it can get quite detailed.

One of the fundamental requests you’ll discover will deal with the specifics of your current financial situation. The franchisor will want to know about your personal assets (and liabilities), for example, because they want to make sure you have enough financial resources to operate the business in case it runs into unforeseen financial difficulty.

And it won’t just be your financial status the franchisor is concerned with. You will probably also be asked about your spouse’s financial state. Some franchisors will want to know if you have financial partners or backers. These are all important questions.

Again, the franchisor wants to be sure that you, your spouse, and your partners are prepared to make the financial commitment necessary to start and run a franchise business successfully.

Beyond finances, you’ll encounter detailed questions concerning your experience, education, background, and even aspirations. These questions are designed to help the franchisor determine whether or not you meet their profile. In other words, they want to know if you’re the kind of person they think will be able to run the business successfully and fit into their franchise system. They do this not only to protect their brand but also their existing franchisees.

Successful franchise organizations depend on franchisees who follow the franchise system completely. As a result, they don’t want people who they perceive as too independent, or people who won’t play by the book because they like to experiment and try out their own ideas. In one sense, franchising is not for those who think outside the box. In this business, there’s no need to reinvent the wheel.

Franchise applications are kept confidential and neither the franchisor nor the prospect is bound in any way by the submission of the initial application. Again, take the time to fully and accurately complete the application and return it to the franchisor promptly. You can then expect a quick response and most likely a telephone interview with a franchise representative.

What you can expect to find – and be asked – in a typical franchise application form:

• Detailed personal information: including all contact information and other biographical and character background
• Business interests: they’ll want to know if you ever owned a business, have been involved in any kind of litigation/arbitration, or have any partners
• Location preferences: will usually ask for cities/territories you’re interested in and any alternates you would consider as well as if you are open to relocation
• Detailed employment history: where you have worked, what you did, for how long, and annual compensation
• Educational background: and any other pertinent training/experience
• Personal financial statement: assets, liabilities, net worth, source of income, and total income
• General inquiry: many franchisors will want to know what you already know about them, their franchise opportunity, and why you are interested

By Eddy Goldberg

You get only one chance to make a first impression. So does the franchisor.

That’s why, after selecting which franchise brands to investigate, it’s so important to evaluate the franchisor’s response at every point of contact. Whether that contact is by email or by phone, the way a franchisor responds to your initial inquiry is often (though not always) an indicator of how they will treat you if you become a franchisee in their system.

The first contact is usually online, through the franchisor’s website. In most cases, you initiate the communication by filling out an online form. Franchisors will request your basic financial information (net worth, liquidity), history in their industry, management experience, requested locations, and more. Their primary purpose is to weed out those who do not qualify, most often based on their finances.

There is no reason to divulge too much personal data at this stage. Franchisors are merely trying to save their time and yours. If you don’t possess the required net worth and liquid assets, there is no point in the franchisor following up. It’s the first screen.

In fact, some franchisors will disqualify prospective franchisees based on how they fill out the online form. Their thinking is this, and they have a case: “If this person can’t even follow directions and properly fill out a form, how will they ever follow our franchise system?”

Most franchisors today will follow up your initial inquiry with automatically generated emails, slowly introducing you to the concept – and further qualifying your capabilities, timetable, desired geographic area, and level of interest in their brand. These emails are crafted to evaluate your response at each stage, as well as to inform you further about the franchise opportunity.

Then there’s the website itself. Is it easy to navigate? Is there one-click access to a separate franchise page? Is the material laid out cleanly and clearly? Is there a FAQ page? Does it answer all or most of your important questions? Are there testimonials from franchisees? The website is designed to entice qualified prospects by providing enough information to keep them interested, but not give away the store. That will come later in the initial phone call with a franchise sales representative.

The first stages of contact with a franchisor should be a time for you to get answers to your biggest, most important questions: “How much money can I make?” “Is there a territory available where I want?”

This is also a time to determine if your personal and financial goals and values match those of the franchise organization. These are the people you are considering partnering with for 5 or 10 years or more years to build your financial future. Their culture, and your fit with it, will be crucial in building a healthy, long-term relationship.

A good franchise organization is interested in the long term, in the revenue generated over the years through ongoing royalties – not in collecting one-time franchise fees. (These are supposed to cover only the franchisor’s costs involved in training you and helping you get started on the right foot, marketing, and a premium for the brand name and operating system – which is what you’re buying). Why does McDonald’s, for instance, stand head and shoulders above its competitors? Not so much because of the quality of its food as the power of its brand and the quality of its operating system.

Remember, you are betting a large portion of your financial future on the brand you choose, so be selective. There are about 3,000 franchise brands out there in virtually every business sector. So if you get the feeling that the people you encounter at the brand of your choice are not the type you’d like to deal with for the next 5 or 10 years, consider other brands. Yes, it’s about making money… and it’s also about lifestyle, values, and goals, and the people and organization you will feel comfortable with in the long term.