Buying a franchise in Colombia: how to compare formats

Choosing a franchise is not simply a matter of picking a well-known brand. A kiosk, a restaurant with table service and a delivery-only outlet may belong to the same franchise network but require very different operations. Before buying a franchise in Colombia, compare the specific format on offer: what it allows you to sell, what it needs to operate and what limitations your business will face.

1. Compare opportunities that meet the same need

The Bogotá Chamber of Commerce recommends assessing at least two franchise options in the same business sector. For that comparison to be useful, listing two brands is not enough: you need to establish exactly what you are buying under each proposal.

Start by defining the type of business you want. For example, if you want to serve customers buying food on the go, compare formats designed for that purpose. A restaurant where customers spend longer dining may have an appealing brand, but it involves a different kind of operation.

Prepare a fact sheet for each option covering:

• Format offered: kiosk, shop premises, shopping centre island unit, production unit or another configuration.
• Authorised range: the products and services you will be allowed to sell.
• Available channels: in-person service, collection and delivery, where permitted.
• Infrastructure required: floor space, storage, utilities and essential equipment.
• Operating capacity: the orders or services you can handle with the planned resources.

Do not fill gaps with information about another outlet belonging to the brand. The features of a large outlet do not prove that a smaller format can offer the same range or serve the same sales channels.

2. Identify restrictions that affect operations

A small format is not necessarily an equivalent, cheaper version of a larger one. It may rely on frequent deliveries, have limited storage or lack the space to prepare certain products. These differences affect service continuity and the customer experience.

Ask for an explanation of the full process behind a sale: receiving supplies, storage, preparation, payment and handover to the customer. Then check that process against the floor plan and technical specifications of the proposed format.

Examine four points in particular:

1. Bottlenecks. Identify which equipment, space or process limits service during peak demand.
2. External dependencies. Check whether the outlet needs a central kitchen, additional storage premises or shared services.
3. Range restrictions. Establish which products you will not be able to offer and whether they are important to the business proposition.
4. Suitability for the location. Check whether the format works with the access, movement of people and goods, and utilities available at your intended site.

Ask for claims about the format’s advantages to be explained in concrete terms. “Simple to operate” does not tell you how many tasks must be handled simultaneously; “adaptable to any space” is no substitute for a technical assessment either. Where relevant, consult qualified professionals and the appropriate authorities about installations and hygiene requirements.

3. Use a comparison matrix with clear grounds for rejection

Build a simple matrix: one column per option and one row per requirement. Mark each item as confirmed in writing, awaiting verification or incompatible with your plans. This helps prevent an attractive sales presentation from obscuring an essential condition.

Separate essential requirements from preferences. If you need to offer delivery, a format that does not permit it should be ruled out, even if it scores highly on appearance or convenience. If your available space cannot accommodate the required installations, do not assume the brand will approve an exception.

Compare what each financial proposal covers, rather than basing your decision solely on the initial franchise fee. Check whether the proposals include the same equipment, fit-out work and operational items. An apparently cheaper offer may exclude components needed to operate.

Finally, test operational scenarios: a delayed supply delivery, equipment out of service or a rise in orders. The aim is not to predict results, but to understand which format has the capacity to respond and which relies on conditions with too little room for disruption.

4. Make sure the contract reflects your chosen format

In Colombia, franchise agreements are classed as atypical contracts: there is no specific, comprehensive statutory framework governing them. The agreed terms and the relevant general provisions of the Commercial Code and Civil Code apply, including the principles of good faith. Freedom of contract does not allow parties to disregard mandatory rules.

Nor is there a general obligation to provide a franchise disclosure document, known as a Circular de Oferta de Franquicia, within a specific statutory timeframe. The document published by Colombia’s Ministry of Trade, Industry and Tourism (MinCIT) in 2021 proposing advance disclosure was a draft decree; publication alone did not make it a rule in force.

You should therefore ensure that the contract and its annexes identify the format being purchased, its authorised product and service range, the permitted sales channels and the applicable technical specifications. If your decision depends on a special adaptation, document its approval and scope before signing. Do not assume that buying into a brand entitles you to use any of its formats.

Practical takeaway: compare equivalent formats, rule out incompatible options and turn the features that matter most into written commitments. The best option is the one that fits your actual plans, not the one that looks best in the brochure.