Buying a Franchise: Speaking to Franchisees in Canada

Before buying a franchise in Canada, speaking to franchisees allows you to compare the sales pitch with day-to-day reality. But you need to choose the right people and go beyond asking, “Are you happy?” This research helps you understand the community you are considering joining, without treating an enthusiastic or disappointed account as conclusive evidence.

1. Build a sample that goes beyond the showcase

Ask the franchisor for contact details of current franchisees and, where available, former franchisees. Do not limit yourself to the people offered as references during the sales process. Also check the contact details in the documents provided during your enquiries, and independently identify outlets comparable to the business you have in mind.

Look for a range of profiles:

• a recently established franchisee, to discuss training and getting started;
• an experienced franchisee, to understand how support evolves;
• an operator in a location comparable to your proposed one;
• an owner of several outlets, whose organisation may differ;
• someone who has sold their business or left the network, if they are willing to share their experience.

Market size, business format and length of time in operation all influence the answers. A busy city-centre outlet is not necessarily a useful benchmark for a small town.

Arrange a conversation in advance, outside peak hours. Explain your plans and make clear that you are not asking for any trade secrets. A refusal may simply reflect a lack of time: on its own, it does not demonstrate a problem within the network.

2. Ask about observable facts

Use the same set of questions for each conversation. This will help you compare answers rather than focus on the most persuasive speakers. Start with the owner's actual role: time spent on site, staff management, administrative duties and availability to cover staff absences.

To assess support, ask for recent examples:

• “What problem did you raise with the franchisor, and how was it handled?”
• “Which part of the training genuinely prepared you for opening?”
• “Which services do you regularly use once the business is up and running?”
• “What support did you receive when software or products changed?”
• “Which obligations surprised you after joining?”

Then discuss expenses that were not fully understood at the outset: additional training, travel, compulsory digital tools or operational changes. The aim is not to draw up a complete budget again, but to identify points that need written confirmation.

If the person you are speaking to is willing to discuss financial results, distinguish between turnover, profit and the owner's remuneration. Ask which period the figures cover and how much personal work was needed to achieve those results. A figure in isolation is neither a forecast nor a guarantee of returns.

Finish with an open question: “What do you wish you had checked before signing?”

3. Understand the rights without reading too much into individual accounts

In Canada, franchise-specific rules fall under provincial jurisdiction; there is no general federal law on pre-contractual franchise disclosure. You therefore need to check the applicable framework for the province where the business will operate.

In Ontario, the Arthur Wishart Act (Franchise Disclosure), 2000 recognises, among other things, franchisees' right to associate. It prohibits franchisors and their associates from interfering with this right and provides a right of action for damages if it is infringed. It also imposes a duty of fair dealing in the performance of the agreement and the exercise of rights under it, including good faith and compliance with reasonable commercial standards.

These protections do not, however, mean that a franchisee must answer a prospective buyer's questions or share their accounts. Respect any confidentiality obligations they mention, and do not request confidential documents without authorisation.

In Quebec, there is no franchise-specific legislation: the Civil Code of Québec governs matters including contractual obligations and good faith. Do not assume that a protection available elsewhere applies there in exactly the same way. Have any legal concerns reviewed by a lawyer who is independent of the franchisor.

4. Turn conversations into decisions backed by evidence

After each conversation, record the date, the outlet's profile and the facts reported. Clearly separate personal experience, opinion and information that needs confirmation. Do not pass attributed quotations to the franchisor without the speaker's consent.

Group your findings into three categories: consistent findings, differing experiences and unresolved questions. If several people report slow support, ask the franchisor how requests are tracked, who deals with them and which commitments are in writing. A precise answer is worth more than a general reassurance.

Raise inconsistencies with your lawyer or accountant, depending on their nature. If essential support remains only a verbal promise, ask for it to be put in writing before committing.

Key takeaway: compare several experiences, look for concrete examples and obtain written confirmation of crucial commitments. Franchisees' accounts guide your checks; they do not replace them.