Buying a franchise: how to interview franchisees

Joining a franchise network means sharing a business model with other independent entrepreneurs. Before choosing a brand, speaking to people who work with it every day can reveal what a sales presentation rarely shows: how much work the business involves, which difficulties keep cropping up and how realistic the initial expectations are. To gather useful information, however, you need a range of people to speak to, consistent questions and a method for comparing their answers.

1. Build a sample, not a collection of testimonials

Conversations arranged by the franchisor are a good starting point, but they should not be your only source. A satisfied franchisee may give an honest account of their experience without representing the conditions you will face.

Ask to speak to business owners operating in different circumstances:

• a recently opened outlet and an established one;
• a business in a town or city similar to your intended location in size and shopping habits;
• an owner-operated outlet and one that relies more heavily on employees;
• where available and willing to talk, former franchisees or owners whose businesses have changed hands.

Comparability matters more than the number of interviews. A highly profitable business in an exceptional location may tell you little about the prospects of an outlet on the outskirts of town. Before comparing answers, note each outlet’s location, how long it has been trading, its size and the owner’s operational role.

Contact franchisees through their business contact details and arrange a quiet time to talk. Introduce yourself as a prospective franchisee, explain the purpose of the conversation and do not pose as a customer to obtain information.

2. Make proper use of legally required information

In Italy, franchising is governed by Law No. 129 of 6 May 2004. Article 4 requires the franchisor to provide a prospective franchisee with a complete copy of the proposed contract, together with the attachments required by law, at least thirty days before signing.

These include a list of current franchisees and the franchisor’s company-owned outlets, along with details of annual changes in franchisee numbers and their locations over the previous three years, or since the business began if it has been operating for less than three years. This information helps you carry out independent checks rather than simply read selected testimonials.

The law provides an exception for attachments subject to objective and specific confidentiality requirements, although these must still be mentioned in the contract. Do not therefore treat a general claim of confidentiality as a sufficient explanation: ask for clarification and have your lawyer assess any restrictions.

Franchisees are not, however, under any general obligation to grant you an interview, nor do you have a right to obtain their confidential accounts. Article 6 requires the parties to act fairly, honestly and in good faith during negotiations; a franchisor’s refusal to provide requested information must be justified where the conditions set out in the law apply. Always distinguish between the franchisor’s obligations and other business owners’ personal willingness to help.

3. Ask about concrete, comparable facts

Do not limit yourself to questions such as ‘Are you happy with it?’ or ‘How much do you earn?’ These are too broad and may produce honest but unhelpful answers. Instead, prepare the same set of questions for everyone.

Day-to-day work: how many hours does the owner devote to the business? Which tasks are they unable to delegate? How much of an impact do staff absences, shift patterns and peaks in demand have? Strong profitability may depend on a level of personal commitment you are not willing to make.

Initial expectations: which assumptions proved realistic and which did not? Ask for examples relating to the time needed to open, customer acquisition and how work is organised. If there was a gap between expectations and reality, ask what caused it: location, management, the local market or features of the business model.

Financial performance: if the person is willing to discuss this, always clarify which measure they mean. Turnover, margin and profit are not interchangeable. In particular, ask whether the figure quoted allows for remuneration for the owner’s work, without demanding confidential documents.

Finish with a useful question: ‘Knowing what you know today, what checks would you carry out before signing?’ This often reveals priorities you had not considered.

4. Turn the answers into an evidence-based decision

Prepare a table recording who you spoke to, the context, the fact reported, any supporting evidence and any outstanding question. Separate opinions from specific incidents: ‘communication is difficult’ is a judgement; a request left unanswered for weeks is a fact worth investigating.

Do not treat a single negative account as grounds to condemn the brand, or several positive reviews as a guarantee of success. Look for recurring themes and differences that can be explained. Put concerns to the franchisor in neutral terms, avoiding sharing names or confidential details without consent, and request written answers on the decisive points.

Practical tip: before committing, summarise three points that have been confirmed, three risks identified and the checks still needed. Share this summary with your accountant and lawyer: interviews should inform your decision, not replace professional analysis.