Buying a franchise: investigate franchisees’ experiences

Buying a franchise should involve more than reviewing a presentation and a contract. You are joining a franchise community where day-to-day working relationships are just as important. Speaking to current and former franchisees can help you explore the gap between promises and practice. A structured approach turns individual accounts into useful information for your investment decision.

1. Choose whom to speak to yourself

A franchisor will probably be happy to introduce you to a few experienced operators. That is a good starting point, but it is not a representative sample. These operators may be unusually successful or have a particularly good relationship with head office. So do not rely solely on recommended references: choose some contacts yourself too.

Aim for a varied group. Consider someone who has recently started, a long-standing operator, someone with a similar catchment area and someone who runs several outlets. Where possible, contact a former franchisee as well. There is no legally prescribed minimum number of reference conversations; what matters more is that you explore a range of circumstances.

Before each conversation, note why that person is relevant to your research. A busy city shop, for example, is not necessarily comparable to your proposed outlet in a smaller town. Differences in location, the year the business opened and business experience may explain why accounts vary.

Ask whether the conversation can take place confidentially, without the franchisor present. Explain how you will use the information, and do not share comments that could identify the speaker without their permission. Your aim is to gain an honest picture, not to create conflict within the network.

2. Understand your information rights under the Dutch Franchise Act

The Netherlands has a Franchise Act, incorporated into Book 7, Title 16 of the Dutch Civil Code since 1 January 2021. Among other things, it governs the exchange of information before a franchise agreement is signed. Its provisions cannot be departed from to the detriment of franchisees based in the Netherlands.

The franchisor must provide certain information in advance, including contact details for other franchisees. They must also explain how consultation is organised and how often it takes place, and provide contact details for any franchisee representative body. These details offer a practical starting point for researching the franchise community.

You also have a duty to carry out your own enquiries: as a prospective franchisee, you must take steps, within the bounds of reasonableness and fairness, to avoid entering into the arrangement on the basis of incorrect assumptions. Reference conversations can help, but they do not replace scrutiny of documents and contracts.

The franchisor’s disclosure obligations do not mean that every franchisee is obliged to speak to you or share their annual accounts. Respect any refusal. If contact details are missing, first request them in writing. Discuss any persistent obstacles with an independent lawyer specialising in franchise law.

3. Ask the same questions and request examples

Use the same core questions in every conversation. This helps prevent one enthusiastic or disappointed account from shaping your entire assessment. Start with open questions, then follow up on specific events:

• What turned out to be different from what you expected before starting?
• Which obligations took up more time than you had anticipated?
• Can you give a recent example of a problem and how it was resolved?
• Are commitments and answers generally confirmed in writing?
• How are discussions handled when franchisees disagree with one another or with the franchisor?
• Knowing what you know now, would you join again, and on what terms?

Always ask when something happened, how often it occurred and whether things have since changed. A problem from the early years may have been resolved; a recent improvement may still need to prove itself.

Distinguish between facts and opinions. ‘Communication is poor’ describes someone’s experience. ‘My written question went unanswered despite two reminders’ describes a specific incident you can investigate further. Where appropriate, ask for supporting documents, but accept that confidentiality may limit what can be shared.

When speaking to former franchisees, also discuss why they left. Retirement, personal circumstances and a business dispute do not tell you the same things about the franchise. Do not draw conclusions from their departure alone.

4. Turn experiences into checks before you buy

After the conversations, create a simple overview with four columns: topic, experience reported, available evidence and outstanding question. Record positive patterns too. Commitments that are consistently honoured are just as relevant as recurring complaints.

Put any inconsistencies to the franchisor in a businesslike way, without revealing confidential sources. For example, if several operators say the complaints process is unclear, ask how complaints are recorded and handled. A process you can verify offers more reassurance than a claim that incidents are exceptional.

Make sure important commitments are reflected in the relevant contractual documents. A verbal promise or a positive reference does not automatically give you an enforceable right. Ask a lawyer to assess whether the documents match your expectations.

Practical conclusion: speak independently to a range of franchisees, ask comparable questions and investigate recurring patterns. Sign only when significant differences between the presentation, franchisees’ experiences and the written terms have been adequately explained.