Questions to the Franchisor about his/her business:
1. How long have you been in the business?
2. How many franchised operations, and how many franchisor-owner operations are there?
3. What is your business background?
4. How many franchises have failed?
5. Can I speak to other franchisees and call and see them?
6. What plans for expansion do you have?
7. What market research has been done?
8. What training do you provide?
9. What territory is included in my franchise ?
10. What financing arrangements are available?
11. Do I have to buy my product from you?
12. What on going help and services will you provide?
13. What happens if I want to sell my franchise?
14. What termination rights do each party have?
15. Are you a member of the Franchise Association of Australia and New Zealand?
16. What happens if you go bankrupt?
17. Do you keep franchisees in touch with each other by means of seminars, newsletters,meetings etc?
18. What operations and other manuals are provided?
19. What is the agreement with the shopping centre management? For instance, what is the rental? Is the rental fixed?
20. Are there any repairs or maintenance works outstanding, yet to be done or imminent?
21. What are the maintenance or other agreements in place relating to equipment, fixtures or fittings?
22. Is there a Mission Statement in each store and do staff know what the Mission Statement means?
23. What assistance is provided with staff hiring, training, selection and motivation?.

Questions to ask the Franchisor about costs and revenue:
1. What is the cost of purchasing a franchise?
2. Exactly what is included in the purchase price?
3. What additional items or services will I need purchase that are not included in the franchise cost?
4. Are any bonds or security deposits required by the centre, you, banks or suppliers?
5. Will they accept bank guarantees?
6. What financing arrangements are there and what are the terms or repayment?
7. Can I use alternative financing arrangements?
8. Do you have an arrangement with any bank to provide finance?
9. Has any bank refused a finance scheme?
10. How much working capital will I need?
11. What are the costs and revenue for an average franchise?
12. How long before I can expect to break even and what is the break even point?
13. What on going franchise and other fees do you charge?
14. Does the franchisor have any other source of income other then royalty payments from his/her franchisees?

What are the advantages of franchising?
1. A much higher survival rate than for non-francised business.
2. Greater willingness of the banks and finance companies to provide finance packages.
3. Less capital required than for a non-franchise business.
4. Specialised knowledge, training and ongoing assistance provided by the franchisor.
5. Franchisee benefits from the name, reputation, research and development and promotion of franchisor.
6. Benefit of bulk purchasing power of the franchisor.
7. Significant potential to achieve structured growth in sales and profits over a stipulated period of time.
8. The provision of strong ethical management.

Ask yourself the following questions about self employment and franchising.
1. Is the product and service a new one, and if not, is its demand growing or declining?
2. What is the reputation of the franchisor and the product/service
3. What competition is there to the product or service, and is it likely to increase or decrease?
4. If the franchise has first been tried overseas will it work in Australia?
5. What is the competition like in general and in the area you are in?
6. Are there adequate long term sources of supply of the product/service?
7. Are you sufficiently motivated to go into business for yourself?
9. What type of business are you best suited to?
10. Do you have your family’s support?
11. What opportunities are there for self-employment apart from franchising?

Before making a decision please consult your:
(a) Partner (b) Accountant (c) Solicitor (d) Banker