Buying a franchise: how to check franchisees’ experiences

A brand presentation shows how a franchise is supposed to work. Speaking to franchisees reveals what day-to-day business is really like: whether they get timely answers, what surprised them and whether they would make the same decision again. Before joining a franchise network, carry out structured reference checks rather than simply having a friendly chat with someone the franchisor has selected.

1. Choose franchisees at different stages of their business journey

Ask the franchisor to put you in touch with franchisees who have recently opened an outlet, those who have been trading for longer and, if possible, people who have left the network. Different experiences help distinguish early teething problems from issues that persist for years.

Do not rely solely on the most successful outlet. Look for franchisees whose town or city, outlet size, sales channels and personal involvement in the business are comparable to your plans. The experience of someone who owns several outlets may not accurately reflect daily life for someone running their first outlet on their own.

Also check that the person you are speaking to is genuinely an independent franchisee, rather than an employee of the franchisor or the manager of a company-owned outlet. Ask how long they have been trading and whether they have any role in recruiting new franchisees, including whether they receive a referral fee.

A refusal to arrange contact is not, in itself, evidence of a problem, but it does call for an explanation. Personal data can be protected by having the franchisor forward your invitation, leaving interested franchisees to decide whether to contact you. Do not ask for private phone numbers without the owners’ consent.

2. Use the same short questionnaire for each conversation

Explain to each person in advance that you are considering buying a franchise and want to understand their practical experience. Wherever possible, speak without the franchisor present. Do not record the conversation without prior agreement; notes are usually sufficient.

Ask the same core questions so that you can compare the answers:

• What differed most from your expectations before signing?
• Which obligation or cost did you only fully understand after opening?
• How was your most recent specific problem with the franchisor handled?
• How much of your personal presence is needed to keep the business running day to day?
• What would you check or negotiate differently today?
• Would you buy the same franchise again, and on what terms?

Follow up general answers by asking for an example. Rather than simply concluding that support is “excellent”, it is more useful to find out whom the franchisee contacted, what response they received and whether the problem was resolved. Take the same approach to negative feedback: dissatisfaction needs to be understood in context, not automatically accepted as a fact about the entire network.

Do not ask for trade secrets, employees’ personal data or other people’s contracts that the franchisee is not allowed to share. A description of the process, without confidential figures or documents, is often enough to assess their experience.

3. Compare the answers and investigate differences

After each conversation, record the date, the outlet’s characteristics and the key points made. Separate the franchisee’s personal impressions from specific events they describe, and flag anything that still needs checking. Do not treat consent to a conversation as permission to publish their name or statements.

Pay particular attention to patterns. If several unrelated franchisees describe the same difficulty, seek further explanation. If their experiences differ, check whether this reflects different versions of the agreement, locations, opening dates or changes in the network’s management.

Ask former franchisees whether they left because of personal circumstances, a business sale, the expiry of their agreement or a disagreement with the franchisor. Leaving does not in itself prove failure, just as staying does not prove satisfaction. What matters is the sequence of events and how outstanding obligations were settled.

Then send the franchisor neutral, specific questions, without unnecessarily identifying the people you spoke to. For example: “What is the current process for logging and resolving an outlet’s request that has gone unanswered?” Ask for a description of the procedure in place, rather than simply accepting reassurance that the problem no longer occurs.

4. Turn those experiences into purchase terms you can verify

Croatia has no dedicated franchise law, no separate mandatory franchise register and no standardised, legally required franchise pre-contractual disclosure document. A franchise agreement is an innominate contract, meaning it is not a specifically defined contract type under Croatian law. Contractual relationships are governed primarily by the Civil Obligations Act (Zakon o obveznim odnosima), including the principle of good faith and fair dealing.

Do not therefore assume that you have a specific statutory right to receive a list of all current and former franchisees. Ask for access to references as part of your pre-signing due diligence. The absence of franchise-specific legislation does not mean that negotiations fall outside the general rules on liability.

Another franchisee’s positive experience is no guarantee that you will receive the same terms. Check every promise that is crucial to your decision against the draft agreement, and request appropriate written confirmation or a contractual clause. Give your solicitor a summary of unresolved questions, not just the final version of the agreement.

Practical takeaway: speak to a range of franchisees, ask for specific examples and check recurring claims. Use references to identify questions that need resolving before you sign, not as a substitute for your own legal and financial due diligence.