1. Consider the financials
You should be clear how much money you need to start up the business and ongoing payments and commitments. Your accountant may be well placed to provide you with this advice.
2. Speak to existing franchisees
It will tell you a lot about the franchisor to find out how existing franchisees are experiencing ongoing help and support. It may even be better to speak to previous franchisees and find out the reasons why they have left.
3. Check the Code
The Franchising Code is there to protect you. Make sure that you understand your rights and check whether the franchisor has complied with all its obligations. The franchisor is obliged to also give you a copy of the Code before you enter into the franchising agreement. It is good practice with the Code in hand to tick off whether the franchisor has complied with all its obligations including disclosure.
4. All promises should be in writing
Ensure that all promises made by the franchisor are either set out in the documentation provided to you or form part of the contract. If they are not, it may be difficult for you to prove that the promises have been madeat a later stage.
5. Go and see a lawyer
Your lawyer is best placed to guide and give you advice regarding entering into a franchise agreement and whether the franchisor has complied with all its obligations. Your lawyer should be consulted before you commit yourself to the franchise agreement, otherwise the horse may have bolted.